International Construction Law

International construction law has, over the past decades, evolved into a distinct and increasingly coherent field of legal scholarship and practice (Breyer, 2024; Venoit, 2009; Molineaux, 1998; Godwin, 2013; Klee, 2018). Within this broader field, international construction contract law (ICCL) has emerged as a recognisable sub-discipline that focuses on the contractual layer of transnational construction and infrastructure projects. Leading monographs and handbooks by W. Breyer, W. K. Venoit, C. B. Molineaux, W. Godwin, L. Klee and others illustrate this maturation: they analyse international construction projects across all major legal families and jurisdictions, with particular attention to the interaction between domestic contract law and standard-form conditions of contract such as those published by the International Federation of Consulting Engineers (FIDIC).

While the terminology is not wholly uniform, there is a broad convergence in contemporary doctrine (Imamova, 2023; Herdegen, 2024). “International construction law” is commonly used in a wide, functional sense to describe the ensemble of public- and private-law norms that govern the planning, financing, construction and operation of cross-border infrastructure and construction projects. It encompasses, inter alia, public international law (including investment treaties and environmental agreements), international economic law, domestic administrative and regulatory law, and the private law of contracts, torts and property as applied to construction. “International construction contract law”, in turn, is increasingly used to denote the contractual and dispute-resolution dimension of this broader field: the body of rules, principles and standardised practices that govern the formation, performance, risk allocation and enforcement of contracts for construction and engineering works with an international element.

Seen from the perspective of international law in the strict sense, ICCL operates at the interface between the international legal order and domestic legal systems (Schachter, 1991; Grotius, 1994). It is primarily rooted in transnational commercial practice and domestic private law, but it is framed and constrained by treaty obligations (for example, under bilateral investment treaties and free trade agreements), by customary international law, and by general principles such as pacta sunt servanda, good faith and the duty to prevent significant transboundary harm. In arbitral practice relating to international construction disputes, tribunals frequently move along this interface: they apply the parties’ chosen domestic law, take account of international public-law obligations where relevant, and rely on industry standards and commercial usages as a supplementary normative layer.

A substantial body of literature has contributed to articulating this field. Breyer’s International Construction Law: An Overview offers an in-depth analysis of international construction law across the major jurisdictions and legal families, positioning construction as a sector where comparative law and international practice are intrinsically intertwined. Venoit’s International Construction Law focuses on cross-border disputes and the practical challenges of governing-law clauses, jurisdiction and arbitration agreements in complex construction contracts. The International Construction Law Review, edited by Wightman and Lloyd (Wightman & Lloyd, 2002), has, for decades, provided a forum for comparative and doctrinal analysis of construction contracts, remedies and dispute resolution. Molineaux’s International Construction Law supplies a historical and conceptual overview of the emergence of international construction as a distinct field of legal regulation, tracing the move from ad hoc contracts to more standardised documentation and risk-management techniques. Together, these works have supported a growing consensus that international construction law and ICCL can be treated as coherent objects of study.

Within this literature, standard-form contracts, and particularly the FIDIC books, occupy a central place. FIDIC’s conditions of contract for construction, plant and design-build, EPC/turnkey, and consultancy services are used, in one form or another, on major projects throughout Europe, the Middle East, Africa, Asia and the Americas. They are frequently incorporated, with modifications, into public procurement documentation and private commercial arrangements, and they often serve as a benchmark even where other forms (such as NEC, JCT, or bespoke contracts) are actually used. Klee’s International Construction Contract Law, for example, structures a large part of its analysis around FIDIC risk-allocation mechanisms, claims procedures and dispute-resolution clauses, while emphasising the need to read them against the background of the applicable national law. Godwin likewise presents FIDIC conditions as a “universal” tool for the management of large international projects, while underlining that their effectiveness depends on proper adaptation to local legal environments.

The fact that so much of the doctrinal debate is organised around standard forms has sometimes obscured the conceptual foundations of ICCL as a branch of international legal scholarship. A number of authors have stressed that ICCL cannot be reduced to the exegesis of FIDIC clauses. Imamova, in particular, highlights that debates on the concept of an “international construction contract” and on the boundaries of international construction contract law remain fragmented across private international law, international economic law and sector-specific practice. Against this background, it is useful to formulate, in a relatively neutral way, a set of definitions that are acceptable across different legal cultures.

For the purposes of this chapter, “international construction contract” will be used to denote any contract (or set of interrelated contracts) for construction, engineering, infrastructure or related services that involves a material foreign element: typically, the parties are domiciled in different States, the works are executed in a State other than that of at least one party, the financing is cross-border, or the contract incorporates transnational standard forms and is expressly subjected to international dispute-resolution mechanisms. “International construction contract law” denotes the body of legal norms, general principles and standardised practices that govern the conclusion, performance, risk allocation, security arrangements and enforcement of such contracts, including the mechanisms for resolving disputes and managing change over the life of the project.

Defined in this way, ICCL can be described through its object and its subject. The object of ICCL consists of the network of social and economic relations that arise in the planning and execution of large construction and infrastructure projects with an international element. These relations encompass not only the primary obligations of contractors, employers and consultants, but also the positions of funders, insurers, subcontractors, suppliers, public authorities and, indirectly, affected communities. The subject of ICCL consists of the norms and mechanisms through which these relations are structured: rules on risk allocation and pricing, performance security and guarantees, change and variation procedures, claims and notice requirements, and dispute-resolution mechanisms, including both adjudicative and consensual processes.

At the level of international legal theory, this contractual field is embedded in the broader architecture of international law. Slouka’s analysis of international custom and the dynamics of customary rules underscores that international norms cannot be understood solely as static, universal propositions; rather, they emerge from a continuous process of decision-making and alignment of State practice and opinio juris (Slouka, 2012). In the construction sector, recurring patterns of behaviour—such as the regular use of particular standard forms, repeated acceptance of certain risk-allocation models, or consistent recourse to specific arbitral rules—may, over time, inform the development of sector-specific customary norms or general principles.

Grotius’ classical insight that international law is shaped not only by written treaties but also by tacit agreements (taciturn pactum), manifested through consistent and accepted practice, remains relevant for ICCL. The widespread reliance on FIDIC conditions and other standard forms, and their adoption in arbitral awards and domestic case law across multiple jurisdictions, can be understood as a form of tacit normative alignment. While these instruments are not, in themselves, sources of international law in the strict sense of Article 38 of the Statute of the International Court of Justice, their pervasive use and judicial or arbitral endorsement contribute to the formation of a transnational lex constructionis akin to the lex mercatoria of international trade.

From the perspective of international economic law, ICCL is best understood as a sectoral manifestation of the broader normative framework governing cross-border economic relations (Herdegen, 2024). Herdegen’s account of international economic law emphasises its composite character: it combines treaty-based obligations of States, customary rules, and domestic regulatory regimes, all of which affect trade, investment and financial flows. International construction projects are plainly part of this global economic circulation. They often involve foreign direct investment protected by bilateral or multilateral investment treaties, and they may be affected by trade disciplines, sanctions regimes and macro-economic regulation. In investment arbitration, construction-related claims—covering expropriation, fair and equitable treatment, full protection and security or umbrella clauses—illustrate how contractual disputes and treaty-based obligations intersect (Yerniyazov, 2023).

Within this multi-layered context, ICCL performs a set of functions that are widely recognised across legal systems and in the literature. Many authors, drawing implicitly or explicitly on general international-law scholarship, converge on four core functions: (1) risk allocation; (2) dispute resolution; (3) legal coordination; and (4) change management.

First, risk allocation is the foundational function of ICCL. Schachter’s view of international law as a framework for the management and allocation of risks among States and other actors is readily transposable to the contractual sphere. In construction, risk allocation concerns, among other things, ground conditions, design responsibility, delays and disruptions, price and currency fluctuations, regulatory change, force majeure, and political risk. Standard forms such as FIDIC embody detailed risk-allocation matrices: they identify which party bears which risk, under what conditions risk may be transferred or shared, and how risk is reflected in price, time and security mechanisms. National laws then interact with these contractual allocations, enforcing or adjusting them through mandatory rules on, for example, liability limits, consumer or public-procurement protections, or restrictions on exclusion clauses.

Secondly, dispute resolution constitutes a central function of ICCL. International construction projects are particularly prone to complex disputes owing to their technical difficulty, long duration, multiple parties and exposure to volatile economic and political conditions. FIDIC contracts and similar instruments therefore incorporate multi-tiered dispute-resolution mechanisms, typically beginning with engineer’s determinations or dispute boards and culminating in arbitration. Fitzmaurice’s classic analyses of the law and procedure of the International Court of Justice highlight the systemic importance of procedural predictability and the rule-of-law function of adjudicative bodies (Fitzmaurice, 1955); in ICCL, arbitral tribunals occupy a comparable position at the project level. Jenkins’ work on international construction arbitration law documents the specific procedural techniques and evidentiary practices that have evolved in this field, including the use of expert conferencing, detailed procedural timetables and project chronologies (Jenkins, 2021).

Recent empirical research by Besaiso and co-authors shows that international construction arbitrators, when resolving disputes, apply not only the contract and the designated governing law, but also a range of commercial norms and what the authors term “international construction law” (Besaiso & Fenn, 2022). While there is no consensus on the precise legal status of these norms, their recurrent use in arbitral reasoning points to the emergence of a transnational body of construction-specific standards, which arbitral tribunals treat as persuasive guidance.

Thirdly, ICCL fulfils a function of legal coordination. Transnational construction projects typically involve actors from different legal traditions and regulatory environments. They may be framed by inter-governmental agreements, investment treaties, host-State legislation, municipal permits and licences, and a cascade of contracts and subcontracts. Tunkin’s insistence on the alignment of State wills as a fundamental principle of international law finds a contractual parallel in the effort to align, through standard forms and negotiated clauses, the expectations and obligations of diverse private and public parties (Tunkin, 2023). Yerniyazov’s analysis of the interaction between international construction contracts and investment treaties, for example, proposes model provisions designed to harmonise commercial and public interests, covering stabilisation, arbitration, insurance and transparency. Such proposals are particularly relevant in sectors where infrastructure projects are backed by State entities or multilateral development banks and where contractual and treaty-based regimes must be reconciled.

Legal coordination in ICCL also concerns the interface between contract and regulation. Public-law requirements—such as environmental impact assessment, occupational safety, anti-corruption rules or local-content obligations—shape the permissible content of construction contracts and may influence their enforceability. In many jurisdictions, courts and arbitral tribunals are required to consider mandatory public-policy norms when interpreting and applying construction contracts, which in turn pushes drafters to embed compliance mechanisms directly into the contractual framework.

Fourthly, ICCL performs a change-management function. Long-term infrastructure projects are implemented in environments characterised by technological innovation, price volatility, evolving regulatory standards and, frequently, political change. Klee and other authors have shown that FIDIC and comparable standard forms embed sophisticated mechanisms for dealing with changes: variations, claims for extensions of time and additional payment, adjustment for changes in law, hardship and renegotiation clauses, as well as early-warning obligations and collaborative problem-solving tools. These mechanisms are designed to preserve the overall equilibrium of the contract while allowing necessary adaptations over time.

Beyond these four core functions, several further dimensions deserve attention in any doctrinal account of ICCL. One is the linkage between ICCL and international scientific and technical cooperation. Anufrieva has emphasised that legal frameworks for science and technology cooperation must accommodate the circulation of knowledge, standards and innovative technologies across borders (Anufrieva, 2018). In the construction sector, international cooperation in standard-setting—for example in structural design, seismic resistance, or sustainability—directly influences the content of construction contracts, including technical specifications, performance standards and liability regimes. Another dimension is the role of customary norms and practice. As Schachter argues, customary international law arises out of State practice accepted as law; in ICCL, an analogous—albeit not identical—process can be observed in the formation of sectoral customs and usages, which arbitral tribunals and courts increasingly recognise as relevant interpretative tools.

Collectively, these elements support the claim that ICCL can be described as a sector-specific, transnational legal regime anchored in, but not limited to, domestic contract law. It draws on public international law, international economic law, domestic regulatory frameworks and commercial practice, yet it displays a sufficient degree of internal coherence—through convergent case law, arbitral practice, scholarly analysis and standard-form contracts—to warrant treatment as a distinct subfield. This is reflected in the emergence of specialised professional associations (such as international and national Societies of Construction Law), postgraduate programmes dedicated to construction law, and a growing body of case law and arbitral awards treated as precedents in subsequent disputes (Skeggs, 2003).

From a pedagogical perspective, these developments have important implications. First, ICCL can be fruitfully taught not merely as a collection of clauses and claims scenarios, but as a structured body of doctrine aligned with the conceptual tools of general international law: sources, subjects, responsibility, dispute settlement and normative hierarchy. Secondly, ICCL offers a particularly concrete arena in which students from different jurisdictions can observe how international economic law operates in practice: how treaties, customary norms and domestic regulation influence contract drafting and enforcement, and how arbitral practice contributes to the development of transnational standards. Thirdly, ICCL illustrates, perhaps more vividly than many other fields, the need to integrate legal analysis with technical, financial and managerial expertise.

For these reasons, a doctrinal account of ICCL that emphasises its core functions—risk allocation, dispute resolution, legal coordination and change management—has the potential to serve as a common reference point for scholars and students in different legal systems. It does not require a full theoretical agreement on the status of lex mercatoria or on the boundaries of public and private international law. Rather, it proceeds from relatively uncontroversial observations about how international construction projects are actually structured and managed, and it draws on a rich comparative and interdisciplinary literature that spans common-law and civil-law jurisdictions, as well as mixed systems. If approached in this way, ICCL can be presented as a mature, conceptually grounded and pedagogically useful subfield of international law—one that would plausibly command the assent of international lawyers in the United States, Europe, China, India, Russia and beyond, and that justifies its inclusion as a distinct subject in advanced curricula on international economic and commercial law.

The choice of applicable law and forum has become a cornerstone of any major cross-border infrastructure project today. Without clear agreement on these parameters, construction projects face delays, increased costs, and legal uncertainty. Procedural conflicts multiply as the global construction industry relies on distributed supply chains and investors increasingly invoke multilateral investment protection mechanisms to safeguard their capital (Alferova, 2016). Modern private international law doctrine emphasizes that only a proper choice of law and forum can minimize transaction costs. This study hypothesized that aligning the key choice-of-law connecting factors with the criteria for jurisdictional admissibility maximizes procedural economy, regardless of whether a dispute is heard by the International Centre for Settlement of Investment Disputes (ICSID), an ad hoc UNCITRAL tribunal, or a national court.

The study’s objective was to develop scientifically grounded guidance on harmonizing conflict-of-law and procedural norms in the Russian practice of Engineering, Procurement and Construction (EPC) contracts – including those based on the standard forms developed by the International Federation of Consulting Engineers (FIDIC). To that end, the research analyzes legal doctrine, arbitral precedents, and FIDIC model contract conditions, identifying problem points at the stages of contract formation, performance, and dispute resolution. The object of the research encompasses the network of social relations arising from cross-border construction projects; the subject is the body of private international law norms and international procedural norms that govern the determination of applicable law and competent forum.

The methodology integrates a formal legal analysis of Article 42(1) of the 1965 Washington Convention (ICSID Convention) on the Settlement of Investment Disputes between States and Nationals of Other States, interpretation of Article 35 (formerly 33) of the UNCITRAL Arbitration Rules, a comparative assessment of Anglo-American and continental risk allocation approaches, as well as a review of arbitral precedents in the field of international construction contract law. This combination of methods provided a multifaceted perspective on the problem.

The relevance of this topic is underscored by recent scholarship. For example, Born and Kalelioglu (2021) demonstrate that even amid universal acceptance of party autonomy, states delineate the bounds of public policy differently. Huang (2023) shows how China’s new Civil Procedure Law (2024) dramatically changes rules on international jurisdiction, forcing contractors to rethink their forum selection strategies. Meanwhile, Yakovleva (2022) finds that even a formally impeccable arbitration clause may be ineffective if the dispute falls outside ICSID Convention criteria – a particularly acute issue for construction concessions.

The core problem lies in the multi-tiered nature of major international construction and investment agreements: a single dispute often intertwines contractual claims with treaty-based investment claims. Properly disentangling these layers allows a tribunal to apply the correct norms and avoid duplicative proceedings. However, Russian practice – despite formally giving priority to treaties over domestic law (Article 15(4) of the Russian Constitution) – still relies on a limited set of “special conditions” and does not always integrate FIDIC standards seamlessly into international projects. This creates a gap between contractual practice and public-law guarantees of investment security. As academician A. G. Lisitsyn-Svetlanov observes, the task for developing the legal system lies “not in creating special conditions for foreign investors, including special dispute resolution arrangements, but in ensuring a general investment regime based on fair competition” (Lisitsyn-Svetlanov, 2021). In other words, overly preferential regimes for foreign contractors, absent a robust general framework for investor rights, risk undermining sovereignty and legal coherence.

International construction projects – for instance, those carried out under FIDIC contract conditions – frequently give rise to complex disputes involving foreign contractors and states. Such disputes invariably raise questions of both the applicable law and the jurisdiction of international arbitral forums. Over the past decades, a substantial body of case law has developed under the three main mechanisms for international dispute resolution: the ICSID system, ad hoc arbitrations under the UNCITRAL Rules, and arbitrations administered by the Permanent Court of Arbitration (PCA). A notable commonality across these fora is how arbitral tribunals determine and apply (1) the applicable law, i.e. the set of legal rules governing the merits of the dispute; and (2) jurisdiction, i.e. whether and to what extent the tribunal has authority to hear the dispute. An analysis of ICSID, UNCITRAL, and PCA decisions reveals both similarities and differences in their approaches to conflict-of-law issues and to the interplay between contractual obligations and investment treaty norms. In what follows, key precedents – leading cases concerning large international construction contracts and infrastructure projects – are examined to illuminate prevailing trends and distinct features.

Applicable Law under ICSID Practice. In ICSID arbitration, choice-of-law is governed by Article 42(1) of the Washington Convention 1965. If the parties have not explicitly agreed on the applicable law, an ICSID tribunal “shall apply the law of the Contracting State party to the dispute (including its conflict-of-laws rules) and such rules of international law as may be applicable.” In practical terms, for an investor–state dispute arising from a construction contract (for example, a contract with a state agency), an ICSID tribunal will primarily apply the law chosen by the parties in the contract (e.g. the law of a specified country). In the absence of such choice, the law of the respondent state applies, supplemented by applicable international law.

In practice, applying Article 42 of the ICSID Convention means that the first sources of regulation are the provisions of the bilateral investment treaty (BIT) and the individual contract between the investor and the host state, as well as the domestic law of the host state. International law plays a secondary role in this scheme: it fills gaps in the national law or is used to correct national law if its application would violate peremptory norms of international public policy. For example, in World Duty Free Company v. Kenya (ICSID Award, 2006) (World Duty Free v. Kenya, 2006), the contract contained two conflicting choice-of-law clauses – one selecting Kenyan law (Article 10(A)) and another selecting English law (Article 9(2)(c)). The tribunal had to reconcile these clauses, find their common core regarding the prohibition of corruption, and apply both cumulatively. Guided by Article 42(1) of the ICSID Convention and taking into account international anti-corruption standards, the tribunal held the contract voidable for corruption and – given Kenya’s timely repudiation of the agreement – denied the investor’s claims. This case highlights that even where a national law is expressly chosen by the parties, ICSID tribunals must consider international legal constraints (such as the prohibition of corruption as a jus cogens norm) and adhere to international public policy principles to ensure a fair and lawful resolution.

Frequently, an investment dispute stems from a BIT, and the construction contract itself includes an applicable-law clause. Most BITs stipulate that disputes shall be resolved with regard to the treaty’s provisions and “applicable rules of international law.” When submitted to ICSID, such a clause is treated as the parties’ agreement on applicable law under Article 42(1) of the ICSID Convention. This was the approach in Bayindir v. Pakistan (ICSID Award on Jurisdiction, 2005) (Bayindir v. Pakistan, 2009), where the tribunal deemed the Turkey–Pakistan BIT of 1995 and general principles of international law to be the governing law, since the investment agreement itself did not reference any national law. At the same time, obligations arising from the construction contract with Pakistan’s National Highway Authority were governed by Pakistani law as the law of the contract; the tribunal considered those domestic norms only insofar as needed to determine whether the state breached the BIT (including evaluating the legality of the contract’s termination under the fair and equitable treatment standard). In the landmark case Salini Costruttori S.p.A. and Italstrade S.p.A. v. Morocco (ICSID Award, 2001) (Salini v. Morocco, 2001) concerning a FIDIC highway construction contract (Rabat–Fès), the ICSID tribunal noted that neither the contract nor the Italy–Morocco BIT contained an autonomous choice-of-law clause. Therefore, under the second sentence of Article 42(1) of the Convention, the law of the host state, combined with applicable international investment law norms (primarily the BIT itself), was applied. In practice, Moroccan civil and administrative law governed the assessment of the contractor’s performance of contractual obligations, whereas the question of the state’s violation of standards like “fair and equitable treatment” or “full protection and security” was decided by international law criteria, with the BIT considered a specialized source of such criteria.

Applicable Law in UNCITRAL and PCA Arbitrations. In ad hoc arbitrations under the UNCITRAL Rules (including those administered by the PCA), the applicable law is determined by the parties’ arbitration agreement and the UNCITRAL Rules themselves. Article 35 of the UNCITRAL Arbitration Rules provides: “The arbitral tribunal shall apply the rules of law designated by the parties as applicable to the substance of the dispute. Failing such designation, the tribunal shall apply the law which it determines to be appropriate.” Thus, if a dispute arises from an international construction contract governed by a specific national law (as is typical in FIDIC contracts, where the governing law of the project country is usually designated in the Particular Conditions), an UNCITRAL tribunal will apply that chosen national law. Conflict-of-laws analysis becomes relevant only if the parties have not designated any applicable law. In that event, arbitrators typically resort to general conflict principles, often favoring the law of the country with the closest connection to the dispute (for example, the law of the state where the construction is located or where the main obligations are to be performed).

In many investor–state disputes involving construction contracts, however, the applicable law is derived less from the contract and more from the BIT’s provisions. When an investor initiates an UNCITRAL arbitration alleging breaches of a BIT – whether expropriation, unfair treatment, or violation of an umbrella clause – the tribunal generally looks to the BIT text and international law. It treats the BIT itself as the parties’ agreement on applicable law, effectively mirroring the ICSID approach, albeit without the explicit mandate of Article 42 of the ICSID Convention. A telling example is Romak v. Uzbekistan (UNCITRAL Award, 2009) (Romak v. Uzbekistan, 2009). There, a Swiss company’s one-off grain sales under GAFTA standard contracts were claimed to be an “investment” under the Switzerland–Uzbekistan BIT. Applying the interpretative principles of the 1969 Vienna Convention on the Law of Treaties, the tribunal confirmed that a protected investment must involve contribution, duration, and risk. A simple transfer of goods did not meet these criteria. Consequently, in the absence of an “investment,” the law applied was only that relevant to determining jurisdiction – comprised of international law rules for BIT interpretation – and no national law governed the merits. By contrast, in disputes where the investment nature of a transaction is uncontested, purely contractual aspects may be additionally governed by domestic law.

Another example of a multi-tiered choice-of-law approach is the Eurotunnel arbitration (Channel Tunnel Group Ltd. & France Manche S.A. v. UK & France, PCA). The applicable law was defined by a layered conflict clause: pursuant to Article 19(6) of the 1986 Treaty of Canterbury (Fixed Link Treaty) and Clause 40.4 of the Concession Agreement, the tribunal applied, first, the Treaty and the Concession Agreement themselves; second, general principles of international law; and only thereafter would English or French law be considered, and then solely to the extent needed for the performance of specific obligations. Moreover, Clause 41.1 confirmed that national law operated subsidiarily “to the extent applicable.” The tribunal gave priority to the Treaty and Concession terms, characterized the claimants’ demands as contract claims, and only took national laws into account insofar as they fit within the agreed “concession legal regime” and did not contradict it. This demonstrates the PCA tribunal’s flexible blending of international and national elements in disputes where a private contract is embedded in a broader public-law framework.

Across all major arbitration fora, a common logic for determining applicable law emerges: if the parties have an agreement on governing law, it is respected; absent such agreement, arbitrators strive to identify the law most closely connected to the dispute. In investment disputes under ICSID, UNCITRAL or PCA auspices, the nearly invariable priority is given to the relevant investment treaty’s norms and international law, whereas domestic law is chiefly brought in to resolve strictly contractual issues (such as the existence and scope of obligations or the consequences of their breach). Differences between institutions are largely attributable to their constitutive instruments: for example, ICSID formally requires consideration of the host state’s law (which can be critical if the BIT leaves certain issues uncovered), whereas the UNCITRAL and PCA rules grant tribunals more latitude in choosing conflict-of-law methods. Yet, in practice, these differences have been virtually eliminated in recent decades: tribunals in all forums generally reach substantively similar outcomes, either applying the law expressly chosen by the parties or, if none, the host state’s law in combination with general principles of international law. The convergence of approaches is illustrated by cases involving interference by domestic courts in the enforcement of construction arbitration awards. In Saipem v. Bangladesh (ICSID Award, 2009) and ATA Construction v. Jordan (ICSID Award, 2010), ICSID tribunals characterized the annulment or obstruction of arbitral awards by national courts as a breach of the state’s international obligation to honor the BIT, even though the underlying contracts were governed by Bangladeshi and Jordanian law, respectively. In both cases, the tribunals relied on BIT provisions ensuring fair and equitable treatment of investments and on state responsibility norms, thereby demonstrating the primacy of international standards over domestic norms when investor rights are undermined.

Jurisdiction and Arbitrability of Investment Disputes. ICSID jurisdiction is based on the Washington Convention 1965 and the parties’ consent (typically via a clause in an investment treaty or directly in a contract with the state). A key requirement is the existence of an “investment” under Article 25(1) of the ICSID Convention, and the dispute must arise directly from that investment. In the context of construction projects, this means the contractor–investor must make a substantial contribution to the host state’s economic development – the construction of infrastructure usually meets this test. In the aforementioned Salini v. Morocco case, the tribunal famously articulated the Salini criteria for an investment: a contribution of capital or other assets, a certain project duration, an element of risk, and a contribution to the host country’s development. The highway construction contract in Morocco, financed by the investor (an Italian company) and involving technology transfer and risks, was held to qualify as an “investment.” This approach has been reaffirmed in numerous subsequent ICSID cases involving roads, energy facilities, real estate, etc. For example, in the above-discussed Bayindir v. Pakistan, as well as in Jan de Nul v. Egypt and Toto Costruzioni v. Lebanon (Toto v. Lebanon, 2012), the tribunals applied the Salini test. In Toto, an ICSID tribunal in a 2009 jurisdictional decision confirmed that a construction contract can constitute an “investment” under Article 25(1) by recognizing contribution, duration, and risk; simultaneously, it dismissed claims based purely on contractual obligations that did not implicate the exercise of sovereign prerogatives. By its final award in 2012, the ICSID tribunal in Toto dismissed all BIT claims on their merits, emphasizing the fundamental difference between contractual breaches and breaches of international investment law, noting that some delays were due to the contractor’s own changes, and splitting the arbitration costs between the parties.

Another jurisdictional prerequisite for ICSID is the presence of a “foreign investor” – a natural or legal person with nationality in a Contracting State other than the host state. Determining nationality can be legally complex, especially with multi-tier corporate ownership. In classic EPC contract disputes, this was rarely at issue, as contractors were typically incorporated in ICSID member states. However, arbitral practice shows that respondent states may challenge an investor’s foreign status by arguing loss of the required nationality or lack of effective foreign control in multi-layered corporate structures. The case of Autopista Concesionada de Venezuela v. Venezuela (ICSID Award, 2003) (Autopista v. Venezuela, 2003) is illustrative: the highway concessionaire was a Venezuelan company, but after a foreign corporation acquired a controlling stake, the parties agreed in the contract to treat the company as an investor from an ICSID Contracting State. The tribunal upheld jurisdiction, noting that Article 25(2)(b) of the ICSID Convention permits such contractual designation of foreign investor status regardless of formal place of incorporation. The only exception is where an investor cannot prove the required foreign nationality: for example, in Soufraki v. UAE (ICSID Award, 2004) (Soufraki v. UAE, 2004), the claim was dismissed because the claimant had lost his Italian nationality before filing. In all construction-related cases, ICSID tribunals independently verify the investor’s citizenship against Article 25’s requirements; finding that the claimant held the host state’s nationality at relevant dates obliges an ICSID tribunal to decline jurisdiction. However, that does not bar the investor from pursuing arbitration under UNCITRAL Rules or at the PCA, which are not constrained by Article 25 and instead follow the BIT’s text.

ICSID also requires that the dispute arise directly out of investment activities. In construction contracts, there are often simultaneously “contractual disputes” (e.g. over unpaid work or unlawful termination by the state purchaser) and potential “treaty claims” (e.g. expropriation if the state confiscates equipment or materials, or a breach of fair treatment due to arbitrary government interference). In such cases, a fundamental issue is delineating whether the tribunal is addressing only BIT violations or may also adjudicate claims based solely on the civil contract, which do not implicate international law norms.

ICSID practice has established a clear stance: a contractual forum selection clause (for instance, requiring submission of contract disputes to domestic courts or commercial arbitration) does not in itself divest ICSID of jurisdiction over BIT claims. An investor may bring claims for breach of an investment treaty even if the same facts also constitute a breach of the state’s contractual obligations. The seminal statement of this principle came from the ICSID ad hoc Annulment Committee in Vivendi (Compañía de Aguas del Aconquija) v. Argentina (Decision on Annulment, 2002), which held that a state cannot invoke an exclusive jurisdiction clause in a contract to avoid the characterization of its conduct as a breach of international law; this was reaffirmed in the resubmitted Vivendi case in 2007 (Vivendi v. Argentina, 2007). Therefore, inclusion of a clause in a construction or other investment contract conferring competence on domestic courts affects only the resolution of pure contract claims and does not exempt the host state from liability for breaches of its BIT obligations. Subsequent tribunals, including those in construction disputes, have adhered to this principle. For instance, in the previously discussed Bayindir v. Pakistan (ICSID Award, 2009), the state argued that the core dispute – termination of a road contract – should be heard in the local arbitration specified by the contract (under Pakistani law), and that there was “no independent BIT breach.” The ICSID tribunal rejected these arguments, noting that the claimant’s claims were based on the investment treaty (expropriation, fair treatment, etc.), and even if they overlapped with a contract dispute, that did not deprive the ICSID tribunal of competence. The tribunal also considered the issue of parallel proceedings: since Bayindir had not completed the contractually mandated arbitration but went straight to ICSID, no true “double” proceeding occurred. Similarly, in Toto Costruzioni v. Lebanon (ICSID Decision on Jurisdiction, 2009), a road contractor faced a contractual forum clause requiring disputes to be heard by Lebanon’s administrative courts. The contractor nonetheless brought claims under the Italy–Lebanon BIT alleging delays and government actions. The ICSID tribunal asserted jurisdiction over the BIT claims, finding that they were distinct from the purely contractual claims and were grounded in international law. In that decision, the tribunal also examined the applicability of the “fork-in-the-road” doctrine (under which an investor’s choice to litigate in national courts precludes later international arbitration if the BIT contains an exclusive choice provision). Because the Italy–Lebanon BIT contained no explicit fork-in-the-road bar (only a requirement of a 12-month local litigation period), the tribunal analyzed the investor’s conduct. Claims not previously litigated domestically were deemed admissible, whereas those identical to issues already decided by Lebanese courts were dismissed as inadmissible under the principle of ne bis in idem (no double relief for the same cause of action).

Many BITs – especially older ones – include a fork-in-the-road clause providing that if an investor submits a dispute to national courts or another chosen forum, it cannot later go to international arbitration over the same subject matter. This condition is highly significant for international construction disputes: a contractor who litigates in domestic courts or commercial arbitration on contract issues risks losing the right to ICSID or other treaty arbitration on the same dispute. A strict application of fork-in-the-road is exemplified by Pantechniki S.A. v. Albania (ICSID Award, 2009) (Pantechniki v. Albania, 2009). After riots in 1997 led to the looting of a Greek road contractor’s equipment in Albania, the investor first sued in Albanian courts for contract damages (invoking a contract clause on civil disturbance risks). The Albanian appellate court voided that clause under local law. The contractor then initiated an ICSID case, alleging breaches of the Greece–Albania BIT, including failure to protect investments and denial of justice. The sole arbitrator (Y. Paulsson) carefully examined the fork-in-the-road clause and the subject matter of the domestic vs. arbitral proceedings, concluding that both were based on the same facts and sought the same relief – compensation for the same harm – despite formally different legal bases (contract vs. treaty). The tribunal held that the investor had exhausted its recourse in national courts and thus lost the right to arbitrate under the BIT. The investor’s claims were dismissed not for lack of substantive merit, but because after pursuing national court litigation, the BIT could no longer be invoked.

Multi-Tier Dispute Resolution Mechanisms. International construction contracts (especially FIDIC contracts) almost always provide for a multi-step dispute resolution process: first, referral to the Engineer (the project’s technical administrator); then to a Dispute Adjudication Board (DAB) – in pre-2017 FIDIC editions – or a Dispute Avoidance/Adjudication Board (DAAB) in the 2017 FIDIC update; and only thereafter to arbitration. Likewise, BITs often require an attempt at amicable settlement or litigation in local courts for a period (e.g. 6 months or 1 year) before international arbitration. Non-compliance with these pre-arbitration steps is usually treated as a question of admissibility of the claim, rather than a bar to jurisdiction (ipso jure). In practice, both ICSID and UNCITRAL tribunals are reluctant to dismiss claims purely on procedural formalities if the pre-arbitration step has lost its purpose. For example, a 6-month negotiation period in a BIT is seen not as a jurisdictional barrier but as a procedural requirement that can be “implicitly waived” if the state participated in the dispute on the merits without objection or if negotiations would clearly be futile. In the earlier Bayindir v. Pakistan case, the claimant had notified the dispute and by the time the claim was registered, 6 months had passed – the condition was deemed satisfied. In SGS v. Pakistan (ICSID Decision on Jurisdiction, 2003) (SGS v. Pakistan, 2003), the tribunal held that the formal failure to observe a 12-month waiting period for negotiations (per Article 9 of the BIT) did not deprive it of jurisdiction, as the period had expired by the time jurisdiction was considered.

Regarding the FIDIC contract requirement to refer disputes to a DAB/DAAB first: this issue arose, for instance, in the Pantechniki case discussed above. There, the investor attempted to characterize the contract dispute as an expropriation without going through the DAB. The ICSID tribunal focused on other grounds (notably fork-in-the-road) and did not rule on the effect of bypassing the DAB. In commercial disputes, national courts have confronted similar scenarios. Notably, the Supreme Court of the Philippines considered this in Hutama–RSEA Joint Operations, Inc. v. Citra Metro Manila Tollways Corp. (decision dated April 24, 2009) (Hutama-RSEA v. Citra, 2009). The dispute arose from an EPC contract for the Skyway Project between the main contractor (Citra) and a subcontractor (Hutama-RSEA JO), after part of the contract price was not paid. When negotiations failed, the subcontractor filed for arbitration before the Philippine Construction Industry Arbitration Commission (CIAC) without first referring the matter to a DAB as required by Clause 20.4 of the EPC contract. The main contractor objected to CIAC’s jurisdiction due to non-compliance with the DAB precondition. CIAC, in its decision of August 30, 2005, affirmed its own jurisdiction. On appeal, the Philippine Court of Appeals on May 23, 2007, sided with the main contractor and vacated the CIAC award, holding that prior reference to the DAB was mandatory before arbitration. The subcontractor then appealed, and the Philippine Supreme Court reversed on April 24, 2009, reinstating the CIAC award and affirming CIAC’s authority to decide the dispute. The Supreme Court reasoned that the presence of an arbitration clause itself indicates the parties’ consent to arbitration, and non-compliance with the DAB step does not deprive CIAC of jurisdiction – though it may have other consequences, such as affecting cost allocation or warranting a stay of proceedings to allow the DAB process.

The Role of the PCA. The PCA, as an institution, does not impose additional jurisdictional requirements – they are defined either by the parties’ agreement (consent to arbitration) or the arbitral rules chosen. The PCA even administers inter-state disputes, but in the context of private investments it often acts as a registry for ad hoc arbitrations. In fact, many major UNCITRAL arbitrations involving states in the 2010s (for example, claims against Venezuela after it exited ICSID) were administered by the PCA. In such cases, the jurisdictional conditions are those set out in the applicable BIT. Notably, when resolving disputes under multilateral treaties or special agreements, PCA tribunals also follow the general logic described above. In the earlier Eurotunnel arbitration, besides applicable law issues, the tribunal considered whether certain claims fell outside the scope of the arbitration clause. Ultimately, some claims (e.g. those seeking to hold both governments jointly and severally liable for losses) were found to be outside jurisdiction, as they exceeded the states’ obligations under the Concession. This underlines that in the absence of a universal instrument like the ICSID Convention, a PCA tribunal’s jurisdiction is strictly defined by the parties’ consent.

The results of this study confirm that when choosing the applicable law and determining jurisdiction in international construction contracts, the optimal outcomes occur only by jointly accounting for the functional-sectoral criteria of investment activity formulated in ICSID practice. These criteria, initially systematized in the Salini precedent and detailed by Russian scholars on ICSID subject-matter jurisdiction (Tereshkova & Gadalov, 2022), reliably separate contractual claims from claims based on international investment law. The research demonstrates that this distinction becomes especially persuasive when construction-concession models combine elements of an EPC contract with an investment protection agreement; in such cases, a choice-of-law clause embedded in the FIDIC conditions can function as a “legal bridge” between the public-law regime and the commercial deal.

At the same time, practical findings from UNCITRAL ad hoc arbitrations validate concerns raised about the normative uncertainty of Caspian pipeline projects (Glikman & Mamedov, 2024): the absence of detailed agreed procedures for referring disputes to arbitration still increases transaction costs and encourages parallel proceedings. In the Eurasian context, these risks are exacerbated by the multi-tier treaty network of the Shanghai Cooperation Organisation (SCO), where – as Chinese authors rightly note – collisions have emerged between an overburdened BIT system and rising arbitration costs (Yanyan & Sisi, 2024).

The unifying role of party autonomy should be evaluated through the prism of globalization challenges highlighted in Russian “law of global development” research (Alferova, 2016). These works foreground the balance between state sovereignty and openness of the legal system. The Russian constitutional model already enshrines the primacy of international obligations; the evolution from a dualist to a monist approach has been analyzed comprehensively by O. N. Khlestov (Khlestov, 2021), and I. A. Umnova-Konyukhova has pointed to the need for institutional adaptation of constitutional mechanisms (Umnova-Konyukhova, 2016).

The internationalization of constitutional law and the “constitutionalization” of international agreements – as demonstrated in works by N. V. Varlamova and T. A. Vasilieva (Varlamova & Vasilieva, 2017) – increase national courts’ scrutiny of arbitral clauses. This, in turn, requires practitioners to carefully align choice-of-law anchors with public order mandates – a point repeatedly stressed by Anglo-American authors analyzing the effects of multi-level constitutional governance on cross-border contracts (Weiler & Wind, 2003).

The findings of this study dovetail with Hans Kelsen’s classic concept of the primacy of international law (Kelsen, 2003) and the contemporary doctrine of the “functional supremacy” of international law over fragmented national norms, advanced by James Crawford in Brownlie’s Principles of Public International Law (Crawford & Brownlie, 2019). However, the “twilight” trends of constitutionalism described by D. Grimm, P. Dobner, and M. Loughlin (Gri

The “right to regulate” doctrine (RTR) is a fundamental principle that enables states to exercise their sovereign powers in order to protect public interests such as safety, environmental protection, and human rights. In international law, RTR plays a crucial role, especially in the field of international construction contract law (ICCL), which requires balancing the interests of various actors—both state and non-state. This doctrine allows states to regulate the terms of international construction contracts to ensure compliance with norms that safeguard public interests, including environmental standards, labor laws, and investment protections.

Importantly, the right to regulate extends not only to states but also to an increasing number of non-state actors whose influence on international relations is ever more significant. A striking example is the Holy See, a sui generis subject of international law. The international legal personality of the Holy See is based not on traditional political sovereignty but on its spiritual mission. Its unique status enables it to maintain diplomatic relations with over 180 states and actively participate in international organizations [Araujo, 2000]. This example underlines that legal personality in international law is diverse and does not always depend on traditional attributes of statehood such as territorial control or sovereign authority. Applying RTR to such unique actors as the Holy See permits flexible regulation of their conduct in international relations despite their lack of classic sovereign powers.

No less significant is the example of the United Nations. Although the UN does not possess sovereignty in the classical sense, it wields considerable influence in international relations and actively participates in regulating various aspects of international construction law. For instance, during peacekeeping and reconstruction projects in post-conflict regions, the UN intervenes in construction processes by imposing requirements to uphold environmental standards and human rights. In this case, the RTR doctrine enables the UN to influence international construction contracts even though its legal personality is not rooted in political sovereignty.

Furthermore, the right to regulate doctrine is actively applied by states such as the United States. U.S. law sets high environmental and labor standards for companies operating abroad. Even when American companies enter into international construction contracts in other countries, they must comply with U.S. regulations, including environmental protection and workplace safety standards. This example clearly demonstrates how RTR allows states to regulate the activities of non-state actors, including transnational corporations, thereby safeguarding public interests beyond their own borders.

These examples— the Holy See, the UN, and the USA—show that international legal personality can take various forms. By bringing non-state actors (like international organizations and religious entities) within the purview of the right to regulate, the doctrine permits flexible oversight of their involvement in international construction relations. This expands the possibilities for regulating international contracts and ensures the protection of public interests even when those actors lack the traditional hallmarks of sovereignty. Thus, RTR provides a legal foundation for effective and multifaceted regulation of international relations in the construction sector and other fields where the interests of different subjects of international law must be accommodated.

To better understand state legal personality and its interaction with the RTR doctrine, it is useful to turn to the theoretical work of Georg Jellinek. Jellinek developed the concept of state self-limitation and self-imposed obligation [Jellinek et al., 1900]. His theory illustrates how a state, in exercising its sovereign rights, can voluntarily limit itself in certain respects in order to honor its international commitments. For example, in international construction contracts, states often accept provisions that constrain their freedom to intervene in the economy so as to provide legal stability for foreign investors. At the same time, state authorities retain sovereignty over internal regulatory matters.

Jellinek’s theory reconciled two opposing views on the nature of state sovereignty: the legal positivism of scholars like Gerber and Laband, which emphasized the supremacy of the head of state as the bearer of authority, and Gierke’s “legal socialism,” which recognized the role of corporations and social groups in influencing the structure of power. Jellinek’s synthesis demonstrated that a state’s legal personality can evolve and adapt to changing domestic and international conditions, a point that is especially relevant in the context of RTR.

The Holy See example shows that the international legal personality of non-state actors can take unconventional forms. The Holy See engages in diplomatic activities and international negotiations; its status is founded on spiritual sovereignty rather than traditional state attributes like territory or population [Kunz, 1952]. This case highlights that international legal personality can extend beyond classic statehood to special entities, and the RTR doctrine allows accommodating such uniqueness.

The primary practical goal of the “right to regulate” doctrine is to affirm the sovereign authority of states to enact norms aimed at protecting public interests—environmental protection, public safety, public health, and other key policy areas. At the same time, states’ exercise of the right to regulate must not unduly infringe the rights of foreign investors to fair treatment and the protection of their investments. In the context of international construction contracts, this necessitates a careful balance between state sovereignty and the rights of foreign participants to a stable regulatory framework. Harmonizing public and private interests in the economic sphere not only protects societal interests but also helps ensure long-term legal stability and trust for investors.

An example of the successful application of RTR in arbitral practice is the case of SAUR International SA v. Argentine Republic. In that dispute, the arbitral tribunal upheld Argentina’s right to implement measures to protect public welfare, despite their impact on the interests of a foreign investor. The investor, SAUR, had argued that a freeze on water service tariffs and other government interventions in market mechanisms caused losses and violated its investor rights, essentially claiming that the government’s actions circumvented contractual obligations and international standards. Argentina, however, justified its measures by the necessity of safeguarding the public interest amid an economic crisis. The government contended that its actions were aimed at preventing social and economic collapse and protecting the population, who would otherwise be unable to afford increased water rates during the crisis. The tribunal recognized Argentina’s right to introduce regulatory measures in the face of extraordinary economic circumstances. It noted that Argentina’s actions, though detrimental to SAUR’s commercial interests, were directed toward protecting higher public values such as citizens’ welfare and economic stability. The tribunal also observed that the measures were non-discriminatory and justified by the need to protect society’s interests. This award underscores the importance of acknowledging states’ right to regulate under international law.

Another instructive example is Methanex Corporation v. United States. Methanex claimed that California’s ban on the use of a methanol-based fuel additive violated its investor rights, on the grounds that the new environmental regulations restricted its business and diminished the value of its products. The dispute was heard by a NAFTA Chapter 11 arbitration panel, which had to determine whether such state intervention violated investment protection obligations. The arbitral tribunal dismissed Methanex’s claims, finding that the United States’ right to regulate environmental and public health matters (in this case, a ban on a toxic fuel additive) did not breach the country’s international investment commitments. The tribunal emphasized that a state is entitled to take measures to protect public health and the environment, even if those measures adversely affect private investors. The decision noted that state sovereignty permits the implementation of regulatory measures for the protection of public interests (such as ecology and health), and that such measures do not violate international obligations as long as they are not a disguise for protectionism or a means of unlawful discrimination. The Methanex award confirms that the “right to regulate” doctrine can legitimize state actions taken in the public interest, even when they harm foreign companies’ interests, provided those actions are enacted in good faith and do not contravene express commitments.

Legal scholars have further elaborated on these issues. Anthony Anghie observes that multinational corporations often wield significant leverage that can constrain states’ ability to pursue independent policies. Therefore, the RTR doctrine is important for maintaining legal equilibrium, as it grants states the ability to regulate corporate activities in the public interest [Anghie, 2023]. Jellinek, drawing on St. Augustine’s vision of the “City of God” and the need to limit power, offered secular arguments to justify the state’s monopoly on authority. In his conception of state personality, Jellinek argues that the power of the state is unique because the state binds itself to obey the legal order. The Holy See again serves as an illustrative example: despite lacking traditional attributes of statehood (such as territory and a permanent population), it plays a significant role on the international stage, acting with a form of spiritual sovereignty and actively defending human rights, engaging in humanitarian efforts, and spreading the values of international law [Лычковский, 2011].

Martti Koskenniemi and other jurists support the view that international law must adapt to new challenges of globalization while preserving the sovereign rights of states [Simpson, Koskenniemi, 2002]. The existence of RTR provides a legal basis that enables states to exercise their sovereign prerogatives while still ensuring the protection of foreign investors’ interests. In this regard, the experience of unique actors like the Holy See is noteworthy: despite its unconventional legal status, it continues to participate actively in international affairs, upholding humanitarian and moral principles [Дьяченко, 2006].

As Maxim Likhachev notes, international legal personality is a dynamic concept that changes with historical context and social conditions. In his view, the evolution of personality in international law reflects growing inclusiveness and a desire for the law to account for the needs of human beings, not only state actors [Лихачев, 2023]. By contrast, Affolter observes that a state’s legal personality is a dynamic process which develops gradually and cannot be permanently fixed. A state, acting as a legal person, must constantly reassess the boundaries of its authority in order to maintain a balance between legal norms and the practical exercise of power [Affolter, 1906]. In international law, this is evidenced by the development of stabilization clauses and umbrella clauses in international contracts, which help protect the interests of all parties and ensure predictability and stability in legal relations.

The “right to regulate” doctrine plays a central role in ICCL by enabling states to protect public interests through sovereign regulation of construction contracts and investment projects—evaluating their impact on citizens, the environment, and sustainable development and, where necessary, acting contrary to prior agreements. In doing so, a balance is maintained between the need to uphold legal stability for investors and the preservation of states’ sovereign rights. A key conclusion from this study is that parties to international construction contracts must account for the RTR doctrine when forming agreements. This is not merely a theoretical notion but a practical approach aimed at proper risk assessment and allocation, as well as realistic forecasting of how state and non-state actors might invoke RTR in influencing the execution of major construction and investment projects.

The review of arbitral practice, including SAUR International SA v. Argentina and Methanex v. USA, demonstrates the importance of anticipating potential regulatory initiatives by states. Further inquiry is warranted into the application of the RTR doctrine in the activities of non-state actors, since their actions are governed both by international law and by sovereign domestic legal systems.

Overall, the RTR doctrine provides a robust legal foundation for state action, allowing governments to respond flexibly to the challenges of a multipolar world while preserving their sovereign rights. In the context of international construction contracts, this doctrine helps to achieve a balance between the rights of states and investors, which in turn contributes to a predictable and stable legal environment. Notably, the results of this research indicate that the International Federation of Consulting Engineers (FIDIC), which develops global standards in this area, should take the RTR doctrine into account in its model contracts and guidelines so that such considerations are reflected in the ICCL framework.

The approach proposed herein—to integrate the RTR doctrine into international construction contracts—constitutes a new method of allocating normative risks between the parties. This approach can aid in developing effective legal mechanisms that foster stability and predictability in the regulatory environment for international investments.

International construction projects often span multiple jurisdictions, leading to complex legal challenges regarding which laws and forums govern contract disputes. Lex constructionis refers to an emerging set of transnational principles in construction law, analogous to lex mercatoria in international commerce. It posits that despite varied national laws, there may be universally accepted norms and practices in construction contracts. The jurisdictional aspect – encompassing rules on applicable law, dispute resolution forums, and enforcement mechanisms – is central to this concept. However, achieving uniformity in jurisdictional principles is challenging because each country’s legal system has its own mandates and public policy considerations. This chapter examines how lex constructionis can provide a framework to unify jurisdictional principles in international construction contract law, ensuring that cross-border projects are governed by predictable rules and efficient dispute resolution mechanisms. We explore the tensions between party autonomy and national public order, the role of standard contract forms and arbitration, and examples of how jurisdictional conflicts are addressed in practice. The analysis demonstrates that a convergence of practices – through widely adopted contract standards like FIDIC, international arbitration conventions, and scholarly efforts – is gradually forming an “institutional design” for jurisdiction in global construction projects. The aim is to identify key principles and mechanisms that constitute this evolving lex constructionis, ultimately enhancing legal certainty and reducing disputes’ resolution costs for project participants.

Each jurisdiction traditionally applies its own laws and court systems to construction contracts, which can lead to fragmentation and uncertainty in cross-border projects. Parties from different countries may disagree on which court or law should handle disputes, and inconsistent national rules can disrupt project execution. For example, public procurement regulations or mandatory local contract rules might conflict with international standards. Braig and Mutay (Braig, Mutay, 2016) highlight the tension between res publica (public law imperatives) and res mercatoria (mercantile, private-law principles) in construction contracts, noting conflicts between the FIDIC standard terms and certain provisions of the Russian Civil Code. In some legal systems, international contract norms are not automatically recognized unless incorporated by legislation or treaty. In Russia, for instance, unwritten transnational principles do not supersede domestic law due to the constitution’s dualist stance, requiring transformation of international norms into national legislation (Kremnev, 2021). This limits the direct application of lex constructionis principles, as any foreign arbitration clause or contract standard must align with domestic public policy.

One fundamental issue is the choice of applicable law. Construction contracts often involve owners, contractors, and financiers from different countries, raising the question: which law governs the contract? Divergent conflict-of-law rules yield different answers, undermining predictability. Gurina (Gurina, 2016) observes that the lack of consensus on choosing governing law for international construction agreements frequently leads to legal uncertainty and disputes. Parties may include choice-of-law clauses, but enforceability varies; some countries impose their law for certain contracts (e.g. public works) regardless of parties’ choice. Similarly, the selection of dispute resolution forum (court or arbitration) is fraught with inconsistencies. One party might prefer litigation in local courts while the other insists on neutral arbitration. If not resolved clearly in the contract, this can result in parallel proceedings or jurisdictional wrangling.

Even when contracts adopt international arbitration, national differences in arbitrability and public policy create hurdles. Many jurisdictions have restrictions on what can be settled via arbitration (for instance, disputes involving bribery, antitrust, or certain public interest matters). Some states historically forbade arbitrating government construction contracts, insisting on domestic court jurisdiction. Others require specific procedures before arbitration (like mandatory conciliation). A comparative study by Verdier and Versteeg (Verdier, Versteeg, 2015) demonstrates the wide variation in how national legal systems incorporate international dispute resolution norms: some nations readily enforce foreign arbitral clauses and awards, while others invoke public policy to refuse enforcement. For example, an arbitration award might be unenforceable if the local court deems that the arbitrators’ decision violates fundamental public policy (e.g. if mandatory construction safety regulations were not applied).

Moreover, cross-border enforcement of judgments (as opposed to arbitral awards) lacks a global regime, making litigation outcomes less portable. If a contractor obtains a court judgment in one country, it may not be recognized in another country where the counterparty’s assets are located. This uncertainty pushes international contractors towards arbitration under frameworks like the New York Convention 1958, which provides near-universal enforcement of arbitral awards. However, even arbitration faces public-order exceptions: any award enforcing contract terms contrary to a nation’s regulatory statutes (such as building code or licensing requirements) might be refused enforcement on public policy grounds.

The fragmentation is also evident in the use of standard contract terms. The FIDIC (Fédération Internationale des Ingénieurs-Conseils) contract forms are widely acclaimed as international standards for risk allocation and dispute resolution in construction. Yet their legal effect can differ by jurisdiction. While many countries accept FIDIC conditions as valid contractual terms, others require adaptations to conform with local law. Bacos (Bacos, 2024) notes that civil law countries in the EU tend to integrate international contract norms into their codes (sometimes translating and codifying FIDIC-like provisions), whereas countries with less developed legal frameworks might adopt FIDIC terms wholesale with minimal changes. This means that the same FIDIC clause (for example, on claim notice periods or interest on delayed payments) might be enforceable in one jurisdiction but not in another if it conflicts with mandatory local law or is interpreted differently.

Another challenge lies in multi-tier dispute resolution mechanisms, such as FIDIC’s requirement for an initial decision by a Dispute Adjudication Board (DAB) before arbitration. Not all legal systems recognize such adjudicative boards. For instance, Russia’s legislation does not provide a clear status for DAB decisions, and its public procurement law effectively precludes appointing an independent dispute adjudicator in state contracts (Sulimov, 2024). As a result, the contractually stipulated DAB process may be bypassed or rendered ineffective in those jurisdictions, forcing parties directly to negotiation or litigation. This undermines the uniform application of multi-tier dispute resolution principles that lex constructionis would otherwise promote.

Finally, political and institutional factors can impede unification. Governments may be reluctant to cede control to foreign law or international arbitration for large infrastructure projects due to sovereignty concerns. In such cases, even if a foreign contractor pushes for international dispute norms, the state employer might insist on local jurisdiction or law, fracturing the lex constructionis ideal. Zhadan (Zhadan, 2016) emphasizes that effective unification of international norms in national practice often requires political will and cooperation. Without endorsement from state authorities, even the best contractual principles may not gain traction domestically.

Despite these challenges, strong converging forces are driving the unification of jurisdictional principles in international construction law. One major force is the widespread adoption of standard form contracts (especially FIDIC) in international projects. These contracts come with pre-defined jurisdictional clauses: they typically specify the governing law (often remaining silent, to be chosen by parties) and crucially, include arbitration clauses under respected international rules (commonly ICC arbitration) along with pre-arbitral dispute boards. Over decades, repeated use of FIDIC conditions in projects worldwide has cultivated a consistent approach to dispute resolution. Contractors, employers, and engineers are accustomed to the idea that disputes will first go to a neutral DAB and then to arbitration rather than local courts. This practice itself is a reflection of lex constructionis at work – a de facto uniform rule that major construction disputes are to be arbitrated, regardless of location. The fact that multilateral development banks (e.g., World Bank, BRICS New Development Bank) mandate or endorse FIDIC contracts for funded projects reinforces this norm, mainstreaming these jurisdictional clauses across continents.

Another unifying mechanism is international commercial arbitration and the supporting legal infrastructure around it. Arbitration provides a neutral forum, which is essential for cross-border construction ventures where parties mistrust each other’s home courts. The 1958 New York Convention and the UNCITRAL Model Law on International Commercial Arbitration (adopted by 85+ countries) have effectively harmonized how arbitration agreements and awards are treated around the world. Thanks to these instruments, if parties agree to arbitrate (e.g. under ICC or UNCITRAL rules), virtually any country they operate in will enforce that agreement and later enforce the arbitral award, subject only to narrow exceptions. This greatly reduces the risk of home-court bias and divergent procedures. As a result, arbitration has become the preferred dispute resolution method in international construction, as reflected in practice and commentary (Jenkins, 2021). In essence, the norms of arbitration – competence-competence (the tribunal’s power to decide its jurisdiction), finality of awards, party autonomy in selecting arbitrators – are now part of the transnational lex constructionis framework.

The lex constructionis also draws from general principles of transnational contract law that have gained broad acceptance. For instance, the principle of party autonomy (the freedom of parties to choose governing law and forum) is widely recognized, within limits. Most jurisdictions now accept that parties can select a foreign law to govern their contract and refer disputes to arbitration or foreign courts, especially in commercial contexts. This principle is enshrined in instruments like the Rome I Regulation in the EU (for law selection) and numerous arbitration statutes. By affirming party autonomy, legal systems converge on a key jurisdictional principle: the contract’s dispute resolution clause should generally be upheld. Even in challenging environments, recent trends are positive. For example, Russian courts historically had a mixed record on enforcing arbitration agreements in state-related contracts; yet in a 2024 case involving a state-owned enterprise, a Russian arbitrazh court honored the contract’s ICC arbitration clause and declined jurisdiction, effectively sending the dispute to London as agreed by the parties. Such enforcement of contractual forums, even in politically sensitive cases, indicates growing respect for lex constructionis principles of neutrality and autonomy.

A further element of unification is the emphasis on arbitrability and public policy exceptions being interpreted narrowly. Many countries have modernized their arbitration laws to allow a wide range of disputes to be arbitrable, including construction disputes that involve complex technical and economic issues. The trend in case law is to interpret exceptions (like “public order”) restrictively so as not to undermine valid arbitration agreements. For instance, issues like fraud or corruption in a construction project – which once might have been deemed non-arbitrable or voiding an arbitration clause – are now often handled within arbitration, with any public policy concerns addressed at the enforcement stage if needed. This global shift aligns with the principle that arbitration is capable of delivering justice even in complicated disputes, a cornerstone for lex constructionis uniformity.

Crucially, there are ongoing efforts to articulate the principles of lex constructionis more explicitly. Scholars and practitioners are identifying common norms gleaned from arbitral awards, standard contracts, and national laws. In a notable contribution, Loots and Charrett (Loots, Charrett, 2022) propose a set of twenty core principles of international construction law (lex constructionis) that cover key aspects of contracts: overarching duties (like good faith and cooperation), risk allocation, time management (e.g., extensions for delays, notice of claims), payment and cost issues, quality assurance, and dispute resolution processes. Among these are jurisdictional principles such as the duty to attempt amicable settlement or adjudication before arbitration, the enforceability of interim decisions (like DAB determinations) pending final resolution, and the commitment to final and binding arbitration. While not yet formally codified in any treaty, such endeavors show a move toward consensus on best practices. Over time, these principles gain persuasive authority – for example, arbitral tribunals start citing earlier awards or scholarly lists of lex constructionis principles when deciding similar cases, thereby reinforcing uniform norms.

The collaboration of international institutions further solidifies unified jurisdictional approaches. FIDIC itself has partnered with arbitration institutions (like the ICC) to streamline dispute resolution for construction – for instance, by developing the Dispute Avoidance/Adjudication Board (DAAB) procedures and ensuring that ICC arbitration rules accommodate multi-tier clauses. Proposals have been made for a specialized international construction dispute resolution forum, possibly under the joint auspices of FIDIC and ICC (Zharikov, 2025). Such a forum could develop a consistent jurisprudence for construction disputes, much as the Court of Arbitration for Sport has done in the lex sportiva domain. Although this is still aspirational, the very discussion of it underscores the perceived need for institutional mechanisms to support lex constructionis.

Harmonization is also gradually being pursued through soft law and model rules. UNCITRAL and UNIDROIT have not yet produced construction-specific conventions, but general instruments like the UNIDROIT Principles of International Commercial Contracts influence construction contract interpretation toward common standards. In addition, region-specific guidelines – for example, the OHADA Uniform Act on arbitration in Africa or the ASEAN protocols – incorporate best practices that reflect globally accepted principles. All these contribute to a more uniform legal environment.

Real-world cases illustrate both the problems and progress in unifying jurisdictional principles. In Union of India v. McDonnell Douglas (1993), an Indian court initially resisted an ICC arbitration clause in a construction contract, citing public interest in local adjudication of infrastructure disputes. However, on appeal, the clause was upheld, signaling a shift in favor of respecting party autonomy consistent with lex constructionis trends. Conversely, in an early 2000s Gulf region case, a local law requiring government consent for arbitration in state contracts voided the arbitration agreement, demonstrating how domestic law can still override transnational norms. Over time, many such outlier rules have been reformed under commercial pressure. For example, several Middle Eastern jurisdictions in the 2010s liberalized their arbitration laws (with Qatar, UAE, Saudi Arabia adopting new laws aligned with the Model Law), thereby removing earlier restrictions.

An instructive case on multi-tier dispute clauses is an ICC arbitration (Case No. 10619, 2001) concerning a FIDIC contract: the tribunal enforced the contractual requirement that the dispute be first referred to a DAB and a waiting period observed, before arbitration could commence. The claimant who bypassed the DAB was found to have acted prematurely. This award, later upheld by a national court at the seat, reinforced that such procedural clauses are binding – a principle increasingly accepted across jurisdictions. It exemplifies lex constructionis in operation: regardless of venue, the parties are held to the same multi-tier process that FIDIC envisages.

Another example is the enforcement of DAB decisions. In the well-known Persero case (Singapore Court of Appeal, 2011), involving a FIDIC contract in Indonesia, the court upheld an arbitral award that essentially enforced a DAB’s interim decision, emphasizing the importance of honoring interim dispute mechanisms. Other courts (England, Switzerland) have similarly found ways to give effect to DAB decisions (either through arbitration or direct enforcement), fostering a uniform principle that “DAB decisions must be complied with or swiftly arbitrated” in line with FIDIC’s intent.

Differences are gradually narrowing even in tricky areas like concurrent jurisdiction. In large projects, it’s not uncommon for related disputes to be handled in different forums (e.g., a bond call dispute in court while the main contract dispute is in arbitration). There is a growing recognition that such parallel proceedings should be minimized. For instance, the ICC has updated its arbitration rules to allow consolidation and joinder, which can unify disputes in one proceeding. Some jurisdictions are also more willing to stay court cases in favor of arbitration when a related arbitration is pending, to avoid inconsistent outcomes. These practices contribute to a more coherent jurisdictional outcome.

Finally, the influence of investment arbitration (ICSID) on construction contract disputes bears mention. When contractors sue states under bilateral investment treaties for issues arising out of construction contracts (e.g., unfair termination of a contract by a state entity), investment tribunals apply international law principles that often align with lex constructionis (fair and equitable treatment, respect for contract clauses, etc.). Cases like Salini v. Morocco (2001) not only established criteria for construction contracts as investments but also underscored the validity of contract terms (the ICC arbitration clause in the contract was noted by the ICSID tribunal). The cross-pollination between commercial construction arbitration and investment arbitration further pushes towards uniform principles, as states realize that disregarding international norms in their contracts can lead to liability on another front.

The evolution of lex constructionis suggests that a more unified set of jurisdictional principles in international construction contract law is on the horizon. Key elements of this unification include: the predominance of arbitration over litigation for cross-border projects; the acceptance of party autonomy in choosing neutral governing laws and forums; the institutionalization of multi-tier dispute resolution (negotiation, adjudication, arbitration) as standard practice; and the gradual reconciliation of these private mechanisms with national public policy requirements. While obstacles remain – such as pockets of resistance in domestic legal regimes and the need for greater clarity on how transnational norms interact with mandatory local laws – the trend is toward convergence.

Crucially, the interaction between private ordering and public authority is being refined. Rather than viewing them as irreconcilable, modern practice seeks a balance: parties can largely structure their dispute resolution as they see fit, but truly fundamental public interests (safety, anti-corruption, etc.) are safeguarded through narrowly tailored legal oversight. The lex constructionis thus does not eliminate the role of national law but harmonizes it with global standards. As shown by various examples, courts and arbitral tribunals across jurisdictions increasingly uphold a common set of principles. International standard contracts and arbitration conventions act as connectors between different legal systems, creating an overarching framework that transcends any one jurisdiction.

To fully realize the potential of lex constructionis, further efforts are recommended. Greater academic collaboration in distilling universal principles will aid in their recognition by courts and arbitral panels. Institutions like FIDIC and ICC could formalize specialized rules or forums for construction disputes, improving consistency in decisions. National legislatures can also support unification by aligning their laws with international best practices (for example, explicitly allowing DAB decisions to have interim enforceability, as some countries have started doing). As Varavenko and Niyazova (Varavenko, Niyazova, 2022) observe, adapting international standards into national law requires both legal and economic analysis to ensure fit – but when done successfully, it significantly reduces legal friction in projects.

In conclusion, the unification of jurisdictional principles through lex constructionis enhances predictability and fairness in international construction contracting. It reduces forum shopping and duplicate litigation, streamlines dispute resolution, and gives parties confidence that their agreed mechanisms (like arbitration) will be respected globally. Over time, this harmonization will lower transaction costs and risk premiums for cross-border infrastructure development. While lex constructionis is still consolidating, its institutional contours are increasingly visible: a blend of standard contracts, arbitral jurisprudence, and scholarly principles coalescing into a coherent transnational legal framework for construction projects. This development ultimately benefits all stakeholders – employers, contractors, and states – by providing a stable legal environment for the collaborative yet complex enterprise that is international construction.zation will lower transaction costs and risk premiums for cross-border infrastructure development. While lex constructionis is still consolidating, its institutional contours are increasingly visible: a blend of standard contracts, arbitral jurisprudence, and scholarly principles coalescing into a coherent transnational legal framework for construction projects. This development ultimately benefits all stakeholders – employers, contractors, and states – by providing a stable legal environment for the collaborative yet complex enterprise that is international construction.

In a multipolar international order marked by expanding intergovernmental cooperation, international financial organizations have become pivotal to infrastructure development and the pursuit of sustainable development objectives. Large-scale infrastructure projects require substantial financial resources and integrated legal support; for that reason, institutions such as the BRICS New Development Bank (NDB) now figure as key actors within international construction contract law (ICCL). These organizations provide not only financing but also frameworks of legal support that streamline contractual architecture and risk-management procedures, thereby facilitating cross-border project delivery.

The legal nature and competence of the NDB in the ICCL domain have long remained only partially examined, notwithstanding the role such institutions play in global infrastructure initiatives. The interface between international and domestic legal orders generates complexities that demand systematic analysis (Abashidze, 2014). Simultaneously, the growth of international organizations and the deepening of integration processes reinforce the need to unify legal standards in ICCL, including rules on contract formation and performance, controls over time and quality, and structured methods of dispute resolution (Union of International Associations, n.d.). Against this background, it is necessary to delineate doctrinally the NDB’s legal status and powers and to relate them to the Bank’s influence on ICCL practices and sustainability standards.

This chapter examines the NDB’s legal nature and competence as an international financial organization and identifies the ways in which its activities shape ICCL norms and sustainability practices. It reviews the NDB’s constituent and internal instruments alongside the international standards of construction contract law to which the Bank’s operations relate; it compares the legal mechanisms of the NDB, the World Bank, and the European Bank for Reconstruction and Development in the financing of infrastructure; and it consolidates observed elements of NDB project practice in order to assess their contribution to the unification of ICCL standards and the reduction of conflict.

The methodological approach relies on a systematic reading of founding treaties and regulations of international organizations, on a comparative-law study of instruments employed by major financial institutions, and on doctrinal approaches to integration law and inter-state cooperation developed in Russian and foreign scholarship (Kashkin & Chetverikov, 2014; Kembayev, 2009). This vantage point enables a view of the NDB through the lens of unification and harmonization processes and through the functional role of international organizations as subjects of international law.

Intergovernmental organizations are established by international treaties and act in accordance with international law; their constituent acts define mandates, organs, and regulatory frameworks. Their international legal personality appears in the capacity to be a party to agreements, to enter legal relations, and to implement projects in their own name, while autonomous will is confined by the mandate granted by member states. Institutional flexibility facilitates adaptation to shifting international circumstances and consolidates the role of organizations in the evolution of the legal order (Bekyashev, 2019). Contemporary doctrine increasingly describes international organizations as “law-makers,” whose decisions, standards, and practices exert institutionalized influence on the formation of norms (Alvarez, 2006). In ICCL this role is visible in the diffusion of standardized contract conditions, assessment and control procedures, and the embedding of environmental and social requirements into contractual models.

Modern integration-law doctrine points to the gradual consolidation of a coherent normative space in which public-law and private-law elements are aligned through international agreements and their practice. Integration, as noted by G. M. Veliaminov, does not result from spontaneous acts; it proceeds through detailed treaties that construct the legal infrastructure of a common economic space, including the free movement of goods, services, capital, and labor, together with institutions overseeing compliance with contractual obligations (Veliaminov, 2015). Yu. S. Bezborodov emphasizes the purposive character of norm-unification across key spheres of legal life and the role of specialized institutions that coordinate the application of agreed rules (Bezborodov, 2017). For ICCL, these integration mechanisms directly support the unification of contractual duties, enhance the predictability of legal outcomes, and facilitate the deployment of complex infrastructure projects.

A comparative view of the World Bank, the European Bank for Reconstruction and Development (EBRD), and the New Development Bank reveals both commonalities and distinctions. Each is created by international agreement and possesses international legal personality; their objectives and mandates, however, diverge and with them the instruments and priorities. The World Bank pursues poverty reduction and sustainable economic development globally; the EBRD concentrates on the transition to market economies and institutional reform from Central Europe to Central Asia; the NDB, established by the BRICS states, mobilizes resources for infrastructure and “green” projects in BRICS and other developing economies, with an openness to expanding membership. Engagement with the private sector varies: the World Bank deploys targeted support instruments for private enterprise; the EBRD consistently advances public–private partnership arrangements; the NDB focuses primarily on sovereign infrastructure while developing modalities for the participation of private actors where these increase project effectiveness. Financial mechanisms also differ. A notable feature of the NDB is lending in members’ national currencies, reducing foreign-exchange risk for borrowers and strengthening project resilience. At the same time, each institution benefits from immunities and privileges necessary to perform its mandate and maintains governance systems that combine borrower requirements with sensitivity to national regulation (Kapustin, 2016).

NDB practice confirms the Bank’s independent legal personality and its capacity to act as a party in transboundary legal relations. Established by intergovernmental agreement, the NDB concludes contracts, opens credit lines, and implements projects across jurisdictions in its own name. That status aligns the NDB with other major international financial institutions and enables it to transmit uniform requirements into financed projects (Bevelikova, 2015). A central avenue is standardization through investment conditions: the NDB orients borrowers toward using internationally recognized standard forms and norms; in particular, the conditions developed by the International Federation of Consulting Engineers (FIDIC) codify transparent risk allocation rules, structured notice requirements, change-management processes, and multi-tier dispute-resolution mechanisms. The inclusion of such conditions in loan and project documentation reduces the probability of disputes, accelerates coordination, and increases the predictability of obligations between employers and contractors drawn from different jurisdictions. Collectively, this broadens the operative space of unified ICCL provisions and strengthens the durability of funded programs (FIDIC, n.d.).

The NDB’s competence manifests in a dual dimension. On the one hand, it is a financial institution mobilizing resources and supporting infrastructure initiatives in priority sectors. On the other, it is a conduit for best practices and standards that help constitute a uniform legal environment for cross-border construction contracts. Local-currency financing is of particular importance as an instrument for mitigating currency risk and cushioning external shocks. In the absence of supranational jurisdiction, the flexibility of internal procedures—adapted to domestic law in the states where projects are implemented—ensures alignment of environmental, labor, and other social requirements with local legal prescriptions. As the project portfolio expands, the role of private-sector participation grows where it contributes to the achievement of project objectives and compliance with efficiency criteria.

A general trend emerges from the comparison of the NDB with the World Bank and the EBRD: the activities of international financial organizations foster the progressive unification of legal standards in ICCL, shaping convergent approaches to risk assessment, change administration, pre-litigation settlement, and arbitration. The NDB’s influence appears both in direct financing and in the consolidation of legal frameworks for project execution, leading to the harmonization of national regimes without diminishing states’ regulatory prerogatives. With the practice of incorporating FIDIC conditions and other internationally recognized norms into contracts, legal risk and conflict potential decrease while the stability and predictability of contractual relations increase.

These findings support further adaptation and deployment of FIDIC-based unified standards within national systems—especially with respect to notice procedures, time limits and evidentiary requirements, change regulation, and multi-tier dispute resolution. Such implementation lowers contractor risk, improves comparability of project documentation, and facilitates access to finance through appropriate legal forms. Parallel scholarly inquiry into the legal status and competence of integration-oriented financial institutions such as the NDB remains relevant to the design of clear legal mechanisms of interaction within formations like BRICS (Abashidze, 2014; Kembayev, 2009). Strengthening the NDB’s standing as an influential actor in international construction requires consistent codification and harmonization of its internal acts with widely accepted regulatory solutions, creating more stable and predictable conditions at the global level.

In an emerging multipolar world and with the intensification of international cooperation in the construction sector, the role of the sources of international law in regulating international construction contracts is becoming increasingly significant. As I. A. Goddard (2018) emphasizes, an effective system of international legal regulation of cross-border construction contracts is based on a harmonious combination of international norms and national legislation, which is a key factor for the successful implementation of large infrastructure projects. L. A. Morozova (2024) similarly notes that the concept of a legal system and its structure plays a significant role in understanding the mechanism of legal regulation, especially under conditions of globalization. The legal framework provided by instruments such as the 1945 United Nations Charter (UN Charter), the 1980 Vienna Convention on Contracts for the International Sale of Goods (CISG), and the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, as well as the standards of the International Federation of Consulting Engineers (FIDIC), defines the conditions for interaction among participants in cross-border projects. However, the issue of the hierarchy of these sources and the practice of their application in different national legal systems remains a subject of debate, linked to differences in national approaches to the primacy of international norms and FIDIC standards. The research hypothesis posits that systematizing and integrating international legal norms, including FIDIC standards, with national law in regulating international construction projects is achievable through their classification and systematic implementation.

According to the World Bank report “Benchmarking Infrastructure Development” (2023), global investments in infrastructure projects have continued to grow, reaching significant levels thanks to reforms in the field of public-private partnerships (PPP). Between June 2019 and June 2022, 45 economies implemented key regulatory changes, which contributed to an increase of approximately USD 488 billion in PPP infrastructure investments. These reforms, especially in contract management, underscore the need for effective legal mechanisms to ensure the protection of the interests of all participants and to promote the sustainable development of international construction projects.

Research Objective: To develop and substantiate practical approaches to the unification and implementation of sources of international law and FIDIC standards in international construction law, as well as to identify tools for their harmonization with national legislation.

Research Tasks:

• Identify the main sources of international law that affect international construction contracts, in order to determine their range and characteristics.

• Define the hierarchy and operating principles of these sources, which will allow understanding their interplay and priority in the context of international construction contract law (ICCL).

• Analyze the possibilities for integrating international FIDIC standards into national legal systems.

• Develop recommendations to improve the effectiveness and stability of the implementation of international construction projects.

Scientific Novelty: In contrast to many studies focused on general issues of the application of international treaties or on practical issues of applying FIDIC standards, this research for the first time comprehensively examines the influence of international treaties and FIDIC standards on the legal regulation of cross-border construction contracts. In a broader context, modern legal doctrine strives to form a universal concept of “sources of law” used in practice. Particular attention is given to international legal scholarship that explores the process of formation and implementation of sources of law at the global level. Thus, the category of “source of law” encompasses not only the material factors and social prerequisites necessitating legal regulation, but also the formation of the content and the binding force of the norms themselves. This approach highlights the significance of sources of law in law-making and law-enforcement mechanisms, but does not provide a detailed methodology for their application in specific branches of law.

Main Aspects of ICCL. The research established that the legal foundation of international construction contract law (ICCL) comprises both the general sources of international law and specialized legal documents and standards. Universal international instruments applicable in the context of ICCL include: the UN Charter (1945), which enshrines fundamental principles of international cooperation; the CISG (1980), which establishes uniform approaches to international commercial contracts; and the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which ensures the binding force of arbitral decisions. It should be noted, however, that the 1986 Hague Convention on the Law Applicable to Contracts for the International Sale of Goods, despite its potential significance, has limited effect due to an insufficient number of ratifications and its not having entered into force.

In addition, it is important to take into account international customs that have developed in the construction industry, and doctrinal approaches rooted in classic works of international law, such as Hugo Grotius’s treatise On the Law of War and Peace (1625), which emphasizes the role of international treaties in reconciling state interests and developing stable international cooperation—matters directly relevant to modern cross-border construction projects. The Principles of the International Institute for the Unification of Private Law (UNIDROIT Principles) not only establish general principles of interaction between commercial parties, but also serve as a basis for developing specialized legal norms applicable to international construction contracts.

To ensure the correct interpretation of the research results, it is necessary to clarify the terms and concepts used in this work within the ICCL framework. International commercial law is an established branch of international law based on international treaties and conventions that govern the conclusion, performance, and termination of contractual obligations between subjects of international legal relations. The foundational legal instrument in this field is the CISG, which provides a uniform legal framework for international commercial contracts and serves as the basis for regulating international construction contracts.

International construction law is a relatively new but rapidly developing branch of international law that covers the legal regulation of construction processes related to the design, erection, and operation of facilities at a transnational level. The importance of this field is confirmed by foundational scholarly works of leading researchers and practitioners in international construction. For example, Wolfgang Breyer’s International Construction Law: An Overview presents a comprehensive analysis of international construction contracts. Wendy K. Venoit, in International Construction Law, examines issues of resolving cross-border construction disputes. The publication International Construction Law Review, edited by D. Wightman and H. Lloyd, delves into questions of harmonizing contract standards and the interaction of diverse national legal systems. C. B. Molineaux’s work International Construction Law is an important theoretical foundation that illuminates the evolution of international construction law from early forms of contract regulation to modern standards.

ICCL is an emerging subfield of international construction law that provides legal regulation for the conclusion and performance of contracts within cross-border construction projects. Despite its relative youth, ICCL has already been discussed in detail in the doctrinal studies of well-known international scholars. For instance, Lukasz Klee, in the monograph International Construction Contract Law, analyzes key aspects of the application of FIDIC standards in international construction practice, examining their impact on risk allocation and dispute resolution. An important practical guide to international construction contracts is William Godwin’s International Construction Contracts: A Handbook, which covers key issues in contract structuring and construction risk management. Also noteworthy is D. I. Imamova’s study The concept of an international construction contract, which examines the distinctive features of the legal regulation of international construction contracts in light of modern trends in private international law.

ICCL represents a complex interdisciplinary legal subsystem at the intersection of private and public international law. In theoretical terms, ICCL contains elements of both branches of international law, due to the specificity of its subject matter and regulatory method. On one hand, ICCL governs contractual relationships between private parties (companies, contractors, investors) in transnational construction projects, which indicates its affiliation with the sphere of private international law. The main legal instruments of ICCL—such as FIDIC standard contract conditions, lex mercatoria principles, and international commercial arbitration mechanisms—confirm its private-law nature. On the other hand, ICCL includes elements of public international law, since transnational construction projects often affect state interests, are governed by international agreements, and require compliance with international safety and environmental standards. In this context, the study by Ya. A. Anosov on the legal regulation of international construction contracting in the EAEU countries is of interest.

It should be noted that arbitral practice in construction disputes is developing in two primary directions. On one hand, the resolution of such disputes is traditionally carried out within international commercial arbitration, in particular under institutions like the International Chamber of Commerce (ICC) and the Arbitration Institute of the Stockholm Chamber of Commerce (SCC). In these venues, construction disputes are resolved predominantly from a private-law perspective, governed by contract terms based on FIDIC standards and other industry standards. On the other hand, practice shows that in some cases construction disputes may fall under the jurisdiction of the International Centre for Settlement of Investment Disputes (ICSID). A precedent confirming this possibility is Salini Costruttori S.p.A. and Italstrade S.p.A. v. Kingdom of Morocco (ICSID Case No. ARB/00/4, known as the Salini case).

Depending on the nature and legal character of a construction dispute, it may be adjudicated either in international commercial arbitration—where disputes are decided on the basis of the parties’ contractual obligations—or in investment arbitration if the project meets the criteria of investment activity and touches upon public-law aspects such as investment protection guarantees and states’ sovereign obligations. Some researchers (e.g., Yerniyazov, 2023) note the potential of investment treaties to harmonize the interests of private contractors and the state.

The relevance of this study is determined by the need for a deep understanding of the mechanisms for the formation and application of international legal norms in the context of construction contracts. Under current conditions, the diversity of legal systems and the cultural characteristics of participants in international projects create a need for unified standards that can minimize legal risks and contribute to the successful implementation of projects. An analysis of the sources of international law makes it possible to identify key elements influencing the regulation of construction contracts and to determine paths for their harmonization. Among such paths, particular importance is given to the “project partnering” model.

The research of leading scholars plays an important role in the theoretical substantiation of the sources of international law. N. Yu. Zavyalova, in her work Sources of international law and their features, provides a detailed analysis of the essential traits and properties of sources of international law from the perspective of general legal theory. She emphasizes that the development of social relations with a foreign element is the main factor predetermining the creation of new legal norms at the international level. Zavyalova also draws attention to the specific characteristics of the subjects of international law-making and the processes of reconciling states’ wills in the formation of international treaties, which indicates the consensual nature of international norm-creation.

B. Krivokapić, in his article The most important sources of international law and their hierarchical interrelation (Part 2), addresses the issue of hierarchy among the main sources of international law—international treaties, international custom, and decisions of international organizations. He notes that despite the traditional recognition of international treaties as primary sources of law, in some cases international customs and decisions of international organizations may carry greater legal force. He pays special attention to the role of United Nations Security Council resolutions and other international organization decisions, which, due to their immediacy and universal applicability, often prevail over other sources of law.

L. P. Anufrieva, in On the sources of private international law (some theoretical issues), focuses on theoretical aspects of defining sources of private international law. She points out the insufficient development of this topic in domestic and foreign scholarship, which in her view creates certain gaps in the understanding and application of sources of law in the practice of international private-law relations. Anufrieva highlights the need to systematize theoretical approaches to defining sources of private international law, considering their dual nature as both an objective and a formal expression of law.

The work of G. Fitzmaurice provides an in-depth analysis of the procedure and jurisdiction of the International Court of Justice, which is directly relevant to understanding the legal mechanisms of dispute resolution in international construction projects. His conclusions can be applied to improve arbitration procedures and judicial proceedings for disputes arising during the implementation of cross-border construction contracts.

The study employed methods of comparative analysis of legal norms and principles governing international construction contracts. Key international conventions and treaties, custom, as well as doctrinal studies related to arbitration and dispute resolution were examined. Special attention was given to analyzing the role of standards developed by FIDIC and their application in various legal systems. Information was collected from authoritative sources such as FIDIC publications and from research by leading scholars in the field of international construction and investment law. The theoretical foundations presented by G. I. Muromtsev in his work Sources of law: theoretical aspects of the problem were also reviewed. G. I. Muromtsev emphasizes the complexity and multifaceted nature of the concept of “source of law,” which indicates the necessity of an interdisciplinary approach to its study and consideration from the perspective of not only public international law but also private international law.

Sources of International Law and Their Influence on ICCL. The study identified the main sources of international law affecting international construction contracts. It was determined that the key among them are international agreements, legal customs, and recognized industry standards that govern legal aspects of parties’ interactions in cross-border construction projects. The UN Charter establishes fundamental principles such as state sovereignty, non-interference in internal affairs, and the peaceful settlement of disputes. These principles create a foundation for international cooperation and for protecting the rights of participants in construction contracts at the global level. The CISG addresses issues related to the supply of construction materials and equipment, ensuring uniform legal regulation of commercial transactions and minimizing legal risks in the performance of contracts. The 1986 Hague Convention, which governs the law applicable to international sales contracts, provides a mechanism for choice of law and jurisdiction, which is critical for cross-border construction projects as it contributes to legal certainty and the protection of participants’ interests. It has been established that FIDIC standards constitute a universal tool for regulating relations between employers and contractors, governing issues of risk allocation, technical aspects of project execution, and dispute resolution. The decisions of international arbitral tribunals, such as ICSID, have a significant impact on practice in the construction sector, serving as important guidelines in resolving conflicts that arise in the course of implementing international construction contracts. International custom, based on consistent state practice, complements the provisions of international treaties, especially in the event of gaps in regulation. In addition to the above sources, the 1958 New York Convention and the UNIDROIT Principles of International Commercial Contracts occupy a significant place, as they promote the unification of arbitral awards and the standardization of contractual relations.

Hierarchy of Sources in the Context of ICCL. The analysis determined the hierarchy and operating principles of the sources of international law regulating international construction contracts. It confirmed that the CISG and the 1986 Hague Convention form the basis of the regulatory framework for construction contracts. FIDIC standards, while not legally binding per se, are recognized by the professional community and are widely applied in the construction industry to unify contract conditions and increase the predictability of their performance. International customs and general principles of law play a supplementary role, filling regulatory gaps and providing flexibility in enforcement. It was identified that the most significant precedent for the international construction sector is the Salini case, in which the so-called “Salini test” was formulated—criteria for considering construction disputes under ICSID. It was established that this test includes such criteria as capital contribution, the presence of risk, a certain project duration, and a contribution to the host state’s economic development. Its application allowed construction projects to be classified as investments and made it possible to bring the relevant disputes under ICSID’s jurisdiction.

Analysis of Integrating FIDIC Standards into National Legal Systems. The study found that the FIDIC national associations of all five founding BRICS countries—Brazil, Russia, India, China, and South Africa—are members of FIDIC. This underscores the importance of FIDIC standards for Russia in terms of engagement with BRICS partner countries. The integration of FIDIC standards into national legal systems, including Russia’s, is achievable through the official recognition and adaptation of FIDIC standard contracts to national conditions, and this process has already begun with a meeting chaired by the Deputy Prime Minister of the Russian Federation, D. N. Kozak. A key obstacle to the full incorporation of FIDIC standards into Russian legislation remains the absence of an adjudication mechanism, which is widely used in global construction practice to facilitate prompt dispute resolution. At the same time, unifying contract conditions and reducing legal risks significantly increase the investment attractiveness of the industry, as was earlier noted in the work of O. Schachter (1991), which emphasized the close connection between the theoretical foundation of international law and its practical mechanisms in cross-border construction.

Practical Recommendations for the Use of FIDIC Standards. Based on the research findings, the primary recommendation is the integration of FIDIC standards into a unified digital registry of construction requirements being developed by the Ministry of Construction and Housing of the Russian Federation pursuant to Federal Law No. 653-FZ of 25 December 2023. The implementation of FIDIC standards in this registry will provide uniform legal conditions for the execution of international construction contracts, simplify access for construction companies from friendly countries to the Russian construction market, and enhance the competitiveness of domestic construction companies within BRICS. An important initiative is to conduct training programs for construction industry participants aimed at mastering the principles of applying FIDIC standards, as well as to create preconditions for implementing the adjudication mechanism in the domestic construction sector.

Conclusion. This study has demonstrated the significance of such sources of international law as the CISG and the 1958 New York Convention in regulating ICCL. The analysis revealed the possibility of classifying construction contracts as investments if the criteria of the “Salini test” developed in ICSID practice are met.

It has been established that FIDIC standards are a de facto globally recognized tool for unifying contract terms and allocating risks in cross-border construction projects.

The absence in some national legal systems (in particular, in the legal system of the Russian Federation) of an adjudication mechanism is seen as an obstacle to the prompt resolution of construction disputes. In this regard, a recommendation has been put forward to institutionally establish this mechanism and to systematically integrate FIDIC standards into Russian legislation.

The study found that integrating FIDIC standards into a unified digital registry of construction requirements, being developed by the Ministry of Construction of the Russian Federation on the basis of Federal Law No. 653-FZ of 25 December 2023, is a promising tool for enhancing the transparency of contractual relations, harmonizing the regulatory framework, and strengthening the principle of mutual trust among participants in the construction industry, including foreign partners.

From a theoretical standpoint, the study substantiates that the concept of “source of law” in international law encompasses treaty norms, customary norms, as well as decisions of international judicial bodies and arbitral practice. It is established that the recognition of FIDIC standards facilitates the development of flexible mechanisms for adapting international norms to national legal orders, while avoiding the loss of public-law safeguards.

The combination of legal instruments (international conventions, international custom, FIDIC standards, and investment arbitral practice) forms the basis of effective regulation of cross-border construction projects. Further elaboration of enforcement practice, as well as the improvement of national legal regimes taking into account the experience of foreign legal systems and state interests, appear to be key directions for future research.

International construction contract law has emerged as a distinct field of transnational commercial law, governing cross-border construction projects and the complex contractual relationships they entail. This body of law is in a phase of progressive development and partial codification, meaning that its rules are gradually being refined, harmonized, and in some instances formally standardized. A driving force in this evolution is the interplay between private-standard initiatives – chiefly the model contracts promulgated by the International Federation of Consulting Engineers (FIDIC) – and international rule-making organizations such as UNIDROIT (International Institute for the Unification of Private Law) and UNCITRAL (United Nations Commission on International Trade Law). Together, these actors contribute to what practitioners often refer to as an emerging “lex constructionis” or transnational construction law: a set of common principles and contractual norms applicable to international construction engagements, analogous to the lex mercatoria of general international commerce. This chapter examines how the integration of FIDIC contract standards into UNIDROIT’s and UNCITRAL’s model laws and principles furthers the progressive unification and codification of international construction contract law. It explores the synergies between privately developed contract forms and public international “soft law” instruments, and how these synergies lay the groundwork for a more coherent global legal framework in construction.

The standard form construction contracts developed by FIDIC have played a pivotal role in shaping international construction contract practice. Since FIDIC’s inception in 1913, its activities have significantly contributed to the unification of legal norms and project management procedures worldwide. FIDIC’s suite of model agreements – notably the Red, Yellow, Silver, and other “Books” – provide a widely accepted contractual platform for allocating risks and responsibilities in construction projects. These standard contracts promote legal certainty by furnishing clear and balanced clauses that define the parties’ obligations, project management mechanisms, and dispute resolution processes. They equip owners and contractors with efficient tools for project administration, protect the rights of both sides, and establish procedures (such as engineer’s determinations and Dispute Adjudication Boards) to address issues that arise during performance. In doing so, the FIDIC forms have not only facilitated individual international projects but also advanced international construction law as a nascent branch of law, strengthening international legal cooperation in the construction industry.

FIDIC contracts essentially function as a de facto codification of best practices in the field. They embody decades of industry experience and compromise between civil law and common law approaches, making them acceptable in a wide array of jurisdictions. The influence of FIDIC standards is evident in the way they have shaped a common understanding of key concepts like unforeseeable site conditions, variations, extensions of time, and payment security. Frequent use of these forms in international projects – often mandated by multilateral development banks and international agencies – has given rise to a body of arbitral awards and judicial decisions interpreting FIDIC clauses. Over time, this has led scholars to identify a transnational “law of construction” or ius ingeniorum, a kind of engineering contract law that is part of the broader lex mercatoria. The Ius Ingeniorum is essentially the product of contractual standardization and repeated usage: in other words, the FIDIC conditions (along with other international standard forms) have become the natural source and primary driver of a global set of construction contract norms.

One hallmark of FIDIC’s approach is the combination of general conditions—intended to be uniform and applicable to all projects—with particular conditions that allow adaptation to local law and project specifics. FIDIC itself emphasizes that its standard terms should be adjusted to comply with the governing law of the contract. This flexibility has eased the integration of FIDIC standards into diverse legal systems. Many national standard forms and government construction contracts have drawn upon or outright incorporated FIDIC clauses, translating and modifying them as necessary to align with domestic legal requirements (for example, adapting liability clauses to fit mandatory law or adjusting dispute resolution procedures to interface with local courts). As a result, FIDIC has served as a bridge between different legal traditions: contractors and owners from different jurisdictions working under a FIDIC contract find themselves operating within a largely harmonized set of rules, and disputes can be resolved with reference to a globally recognized text. This phenomenon significantly reduces legal friction in cross-border projects.

In summary, through widespread adoption and the consequent development of interpretive case law, the FIDIC contract conditions have become a cornerstone of international construction law’s progressive development. They exemplify how private ordering – via industry-standard contracts – can create a uniform layer of obligations and rights above the fragmented mosaic of national laws. FIDIC’s standards lay the practical foundation upon which more formal codification efforts by organizations like UNIDROIT and UNCITRAL can build.

While FIDIC standards have largely driven the bottom-up unification of construction contract practices, formal codification at a higher level of abstraction is being pursued by organizations such as UNIDROIT. The primary instrument here is the UNIDROIT Principles of International Commercial Contracts (UPICC), which constitute a non-binding “restatement” or model code of general contract law principles acceptable to both common law and civil law systemsoas.orgoas.org. The UNIDROIT Principles, first published in 1994 and updated through 2016, provide broad rules on issues like formation, performance, non-performance, and remedies. Their relevance to international construction contracts might not be immediately obvious, given that they are not industry-specific. However, they supply the overarching legal principles – such as good faith, duty to cooperate, the binding character of promises, and flexibility in hardship situations – that can greatly assist in interpreting and supplementing detailed contract terms like those of FIDIC. Notably, the 2016 edition of the UNIDROIT Principles explicitly took into account the special needs of long-term contracts (including construction contracts) by introducing provisions on issues like price determination, renegotiation, and hardship tailored for extended performance periods. This update underscores the Principles’ utility in contexts such as construction where contracts are performed over many years and are subject to changing circumstances.

The synergy between FIDIC contract terms and the UNIDROIT Principles has been highlighted in legal scholarship and practice. Observers note that many specific solutions in FIDIC contracts reflect general principles now codified in the UNIDROIT text. For example, FIDIC contracts impose an obligation on both parties (and the Engineer) to act fairly and cooperate – a notion which resonates with the UNIDROIT Principles’ requirement of good faith and fair dealing (Art. 1.7) and its emphasis on cooperation between contracting parties. Likewise, FIDIC’s mechanisms for adjusting the contract price or deadline in the face of unforeseen events align with the Principles’ approach to changed circumstances (Arts. 6.2.2–6.2.3 on hardship). This correspondence means that when gaps or ambiguities arise in a FIDIC-based contract, arbitrators and judges often resort to the UNIDROIT Principles as a gap-filler or interpretive tool. Indeed, the UNIDROIT Principles have been cited in numerous international construction arbitrations to clarify issues such as mitigation of damages or the scope of contractual duties, thereby effectively integrating with the FIDIC framework to form a more complete governing law.

Moreover, the UNIDROIT Principles play a strategic role in contract drafting for international projects. Parties sometimes explicitly choose the Principles as the law governing their contract (either alone or in conjunction with national law), especially in neutral venues or where the governing law is underdeveloped. In such scenarios, FIDIC terms and UNIDROIT principles operate hand-in-hand: the former addresses technical and risk allocation issues, while the latter provides general rules on contract interpretation, performance, and remedies. For instance, if a FIDIC contract is silent or ambiguous on a particular point (like the exact scope of consequential damages or the standard for excuse due to force majeure), the UNIDROIT Principles can supply an authoritative answer consistent with international practiceoas.orgoas.org. This complementary usage effectively “codifies” the interplay between detailed contract stipulations and general legal norms.

UNIDROIT’s contribution may eventually extend to a more specific level: one can envisage a future project under its auspices to create a model law or guide on international construction contracts. While no such dedicated instrument exists yet, UNIDROIT has precedent in preparing industry-focused legal guides (e.g., in franchising, agricultural investment contracts, etc. oas.org). A UNIDROIT-led model law on construction contracts could codify essential aspects of FIDIC and similar forms within a statutory framework – for example, delineating roles (owner, contractor, engineer), establishing default risk-sharing rules, and providing templates for dispute boards. This would be a form of vertical integration: elevating the privately developed FIDIC clauses into an internationally endorsed legal instrument. Even in absence of a standalone model law, the influence of UNIDROIT’s work is visible: domestic legislators have drawn on the Principles when modernizing civil codes and contract lawsoas.org, ensuring that national contract law reforms are compatible with international contracting practices (as seen, for instance, in reforms in Argentina, China, and various African countries influenced by UPICC). Such reforms indirectly facilitate the use of FIDIC contracts by smoothing inconsistencies between local law and international standards.

In conclusion, UNIDROIT acts as the doctrinal and normative backbone supporting the more practice-driven FIDIC rules. By codifying general contract law principles that align with the needs of construction projects, it creates a conducive environment for the transplantation of FIDIC terms across jurisdictions. This interaction exemplifies how progressive development (through practice and private standards) can be consolidated through codification (via general principles), resulting in a more coherent transnational regime.

UNCITRAL has approached the unification of construction contract law from a different angle – typically focusing on related areas like procurement, dispute resolution, and project finance, rather than on contract substance directly. Nevertheless, its contributions lay crucial groundwork for integrating FIDIC standards into national legal systems and enhancing their legitimacy.

One of UNCITRAL’s early forays relevant to construction was the adoption in 1987 of the Legal Guide on Drawing Up International Contracts for the Construction of Industrial Works. This comprehensive guide systematically discussed the legal issues commonly arising in large construction projects (particularly turnkey industrial facilities) and offered suggestions on how parties might address these issues in contracts. While not a binding instrument, the 1987 Legal Guide effectively codified international best practices of the time, many of which anticipated or reflected the emerging norms of FIDIC contracts. For example, the UNCITRAL Legal Guide emphasized the importance of clear risk allocation for site conditions and change in circumstances, the use of clauses for price adjustment, and the role of neutral contract administration – themes that are now hallmarks of FIDIC contracts. It even noted the utility of standard contract terms promulgated by international organizations, implicitly endorsing their usage for consistency and fairness. Thus, the UNCITRAL Guide served as an authoritative reference that lent credence to the concepts later entrenched in FIDIC’s standard forms. It demonstrated an official acceptance of the notion that international construction contracts require special treatment beyond general sales or services contracts.

In subsequent years, UNCITRAL has provided model laws in adjacent fields that facilitate the implementation of FIDIC-style contracts. For instance, the UNCITRAL Model Law on Procurement of Goods, Construction and Services (1994, revised 2011) sets forth internationally recognized procedures and principles for public procurement. Although the Model Law addresses the tendering and award phase rather than the detailed contract conditions, it creates a framework in which adopting states often look to international standards when drafting their tender documents and contract terms. Article 34 of the 2011 Model Law, for example, encourages the use of standard form contracts where appropriate, especially for complex procurement like construction. Many countries that implemented the UNCITRAL Model Procurement Law opted to attach FIDIC-based general conditions to their standard bidding documents, thus indirectly importing FIDIC language into their legal system. A case in point is certain transition economies and developing countries: as they reformed procurement regulations, they explicitly incorporated FIDIC contract clauses into domestic standard contracts for public works. In this way, the Model Law’s influence dovetails with FIDIC’s content – UNCITRAL provided the procedural skeleton, and FIDIC provided the contractual flesh.

UNCITRAL’s normative work on Public-Private Partnerships (PPPs) and privately financed infrastructure projects is another area supporting integration. In 2019, UNCITRAL finalized a set of Model Legislative Provisions on PPPs accompanied by a guide, which include recommendations on the selection of concessionaires and key clauses in concession agreements. While these provisions do not dictate the use of any particular contract form, they stress principles such as appropriate risk sharing, long-term contractual stability, and fair dispute resolution – all principles central to FIDIC’s philosophy. For example, the UNCITRAL PPP texts emphasize that governments should allow contractual clauses dealing with changes in conditions, step-in rights, and international arbitration. These recommendations make it easier for FIDIC-based contracts (which contain such clauses in refined form) to be accepted in PPP projects financed or regulated under UNCITRAL-inspired laws.

Additionally, UNCITRAL’s greatest contribution might be seen in the procedural regimes that underpin the enforcement of international construction contracts. The UNCITRAL Model Law on International Commercial Arbitration (1985, as amended 2006) and the widespread adoption of the New York Convention (1958) on recognition of arbitral awards have been fundamental in ensuring that dispute resolution clauses in FIDIC contracts are effective globally. FIDIC contracts typically provide for international arbitration (often under rules like ICC or LCIA) as the final binding dispute resolution mechanism. Thanks to UNCITRAL’s instruments, an arbitral award rendered in, say, Singapore under a FIDIC contract for a project in Africa can be swiftly enforced in any of the 170+ New York Convention countries. This global enforceability removes much of the uncertainty that could otherwise undermine the use of uniform contract terms. Similarly, the UNCITRAL Model Law on Arbitration, adopted in many jurisdictions, curtails the grounds on which local courts can interfere with arbitration agreements and awards, giving effect to contract clauses (like those in FIDIC) that channel disputes to arbitration and enforce Dispute Adjudication Board decisions pending arbitration. In essence, UNCITRAL has created an enabling legal environment in which the substantive standardization achieved by FIDIC can operate smoothly and with predictability.

In summary, UNCITRAL’s work – from its 1987 Legal Guide to its model laws on procurement and arbitration – has laid down a critical infrastructure of norms. This infrastructure supports the adoption of FIDIC contract standards by ensuring compatibility with public procurement rules and by safeguarding the dispute resolution process stipulated in those contracts. While UNCITRAL has not codified construction contract terms per se, it has provided the legal “glue” that helps bind FIDIC’s private standards into the public law framework of many states.

The integration of FIDIC standards into domestic legal systems and international instruments can be observed through various examples around the world. One avenue is through the policies of international financial institutions. A prominent development in this regard was the agreement between FIDIC and the World Bank (and other multilateral development banks) under which the World Bank officially adopted several FIDIC standard forms (e.g. 2017 editions of the Red, Yellow, and Silver Books, among others) for use in Bank-funded projects. As of the late 2010s, the World Bank’s Standard Bidding Documents for procurement of works require or strongly encourage borrowers to use the harmonized FIDIC conditions. This effectively elevates FIDIC contract terms to a quasi-mandatory status for a large class of international projects, integrating them by reference into the contractual and financial frameworks that govern those projects. Other development banks (such as the Asian Development Bank, African Development Bank, etc.) have similarly incorporated FIDIC-based conditions in their project procurement guidelines. This trend underscores a de facto global institutional endorsement of FIDIC standards and amplifies their integration as part of the “rules of the game” for international construction.

On the national level, many countries have taken steps to blend FIDIC terms with their local contracting practices. For example, several countries in the Middle East have issued national standard forms closely patterned on FIDIC conditions (often the Red Book for building works and the Yellow Book for design-build). In the Gulf region, government authorities appreciated that FIDIC contracts allocate risk in a way that is acceptable to foreign investors and decided to align their public contract templates accordingly. In some cases, translations of FIDIC contracts into local languages (Arabic, Farsi, etc.) have been published with minor adjustments to comply with mandatory local laws (such as decennial liability in civil law jurisdictions for building works). Similarly, in Eastern Europe and parts of Asia, FIDIC forms penetrated the market via large infrastructure projects financed by international lenders, prompting domestic law firms and engineers to familiarize themselves with these standards. Over time, this has led to a certain convergence: domestic construction contract law is being interpreted and even reformed in light of FIDIC principles. For instance, courts in jurisdictions as diverse as England, France, Brazil, and Turkey have dealt with disputes arising from FIDIC contracts and, in doing so, have clarified domestic legal concepts (like the scope of good faith or the enforceability of dispute board decisions) in a manner that accommodates the FIDIC regime. Such case law contributes to integrating FIDIC norms into the jurisprudence of those countries.

A notable and deliberate form of integration is seen in efforts by national professional organizations to officially adopt FIDIC standards. For example, the Israeli Association of Construction and Infrastructure Engineers has advocated for a “localization” of FIDIC – essentially translating and adjusting the FIDIC conditions for use in Israel’s public construction contracts, with any necessary modifications to conform to Israeli mandatory law. An article by Ronen Haviv (Ron Chavatzeles) in 2020 proposed to “graft and naturalize” the FIDIC contract as Israel’s default public contract form, suggesting that such adoption would remedy chronic issues in the local construction industry related to unfair risk allocation and excessive litigation. The proposal included drafting a Hebrew version of the FIDIC conditions with an annex specifying how to interpret or supplement certain clauses under Israeli law. This initiative illustrates a conscious effort to integrate an international standard within a national legal context, effectively merging the two. While still under consideration, it mirrors steps taken in other jurisdictions – for instance, Kazakhstan in 2014 announced plans to incorporate FIDIC forms as mandatory for certain public works and launched training programs to familiarize local engineers and lawyers with FIDIC procedures. In China, the “Belt and Road” infrastructure push has similarly increased the prominence of FIDIC, with Chinese versions of the contracts being used on joint ventures and some discussion in academic and legislative circles about adopting elements of FIDIC in Chinese contract law frameworks.

These examples show a pattern: where the benefits of international standardization (in terms of attracting investment, reducing disputes, and clarifying obligations) are evident, national systems are receptive to integrating those standards. Sometimes integration is direct (through legislation or official policy), and other times indirect (through party autonomy – contracts voluntarily incorporating FIDIC terms, which domestic courts then uphold).

The interplay of progressive development and formal codification in this field suggests that a more unified international construction contract law is gradually taking shape. It is, at present, transnational in character – not enshrined in one comprehensive treaty or code, but residing in a constellation of sources: model contracts (FIDIC and others), general principles (UNIDROIT Principles), model laws and guides (UNCITRAL instruments), and an expanding corpus of case law and arbitral awards. The integration of FIDIC standards into UNIDROIT and UNCITRAL frameworks can be seen as part of what the International Law Commission would term “progressive development and codification” of international law. Progressive development occurs as practice evolves and new norms emerge (in our context, as FIDIC updates its contracts and as project participants innovate solutions), while codification occurs as those norms are recognized, systematized, and endorsed by authoritative bodies.

One can draw a parallel with the evolution of the international sale of goods law: mercantile custom was eventually distilled into the CISG (Vienna Convention 1980) and various model laws. International construction contract law might be following a similar trajectory. Although there is currently no “CISG for construction contracts”, the building blocks for one are arguably being assembled. If, for example, UNCITRAL were in the future to draft a Model Law on International Construction Contracts, it would likely draw heavily on FIDIC’s well-tested clauses for risk allocation and dispute management, while also incorporating the equitable principles reflected in the UNIDROIT Principles (such as good faith and balance in performance). Such a model law could provide default rules on issues like variations, extensions of time, payment security (e.g. guarantees, letters of credit), termination, and multi-tier dispute resolution – essentially encapsulating the FIDIC/UNIDROIT approach in legislative language. States could then enact these rules, much as they did with the Model Law on Arbitration, thereby achieving a harmonized legal regime. Even absent a formal model law, the convergence of national laws is happening: legislators in several jurisdictions have been inspired by the UNIDROIT Principles in updating their contract lawsoas.org, and these updated laws inherently become more compatible with FIDIC-style contracts (for instance, by recognizing the validity of agreed risk allocations and modern concepts like hardship or by formalizing adjudication as a dispute resolution step).

Furthermore, the international arbitration community and standard-setting organizations continue to reinforce uniformity. The incorporation of FIDIC contract discussion in forums like the International Construction Law Association, and the publication of comparative analyses and guidelines (e.g. by the ICC on construction arbitration or by the IBA), also contributes to a consensus on best practices. We see a cross-pollination: the common law of construction contracts as developed in leading cases (from English, French, Swiss, and other courts) is increasingly informing other jurisdictions, often referencing FIDIC terms or concepts. Arbitral tribunals, not bound by any single national law, often apply transnational principles which effectively merge FIDIC rules with general principles of law – an approach that over time resembles the application of an autonomous legal regime.

In conclusion, integrating FIDIC standards into the work of UNIDROIT and UNCITRAL has significantly propelled the world towards a more unified and codified set of rules for international construction contracts. This integration works both ways: it validates the FIDIC clauses by aligning them with internationally recognized principles (thus giving them a quasi-official standing), and it enriches the international model laws and principles by infusing them with the practical wisdom embedded in industry-tested contracts. The result is a virtuous cycle of progressive development: practice informs principles, and principles shape future practice. While a single, binding international code for construction contracts may still be on the horizon, the foundations of such a code have arguably been laid in these softer forms. Parties to major construction projects across the globe increasingly operate within a familiar legal architecture – one that offers predictability, balance, and a measure of neutrality, whether the project is governed by English law, Brazilian law, or is left to general principles.

The trajectory of this field showcases an effective model for law development: private standard-setters like FIDIC innovate and refine the content, and international bodies like UNIDROIT and UNCITRAL provide the structure and legitimacy. Through their integration, the once disparate national laws relating to construction contracting are slowly but surely coalescing into a coherent international framework. For practitioners and stakeholders, this means reduced transaction costs, fewer choice-of-law complications, and more focus on the technical execution of projects rather than on legal uncertainties. In a world where infrastructure development is crucial and often transnational in scope, the continued progressive development and codification of international construction contract law is not just an academic ideal, but a practical necessity for global development.

The integration of international construction contract standards into domestic law has become a pressing issue amidst the rise of cross-border infrastructure projects and the requirements of multilateral development banks . Turnkey construction contracts governed by the FIDIC conditions (International Federation of Consulting Engineers) have emerged as a ubiquitous contractual model for such projects, offering a balanced allocation of risks between contractor, client, and investor . Yet, many jurisdictions lack a clear legislative definition of the EPC/Turnkey contract, leading to conflicts when transplanting FIDIC’s standard terms into national legal systems . Comparative studies reveal the need to harmonize foreign contractual standards with domestic norms (Lavrenyak, 2023) and highlight the acute problem of choice of law in international construction ventures . International arbitration practice confirms that discrepancies between key FIDIC provisions and local mandatory requirements spur disputes over contract termination and payment . All these factors underscore the significance of further legal harmonization in the field of international construction contract law to reduce conflicts and uncertainty .

Defining the scope of International Construction Contract Law (ICCL) is crucial. Although there is no singular universal treaty governing construction contracts (unlike the maritime or IP sectors), scholarship supports viewing ICCL as an emerging interdisciplinary branch of international law . The frequent use of FIDIC and ISO standards worldwide, the inclusion of New York Convention arbitration clauses in contracts, and the potential recourse to ICSID mechanisms (where construction qualifies as an investment) together delineate the contours of this field . FIDIC and ISO are not intergovernmental organizations and their standards lack treaty status, but their broad practical acceptance in many countries attests to their regulatory importance. As of 2025, FIDIC’s membership spanned 103 national associations from 86 countries, and ISO’s encompassed 173 countries . Accordingly, ICCL can be defined as the body of legal norms and institutions governing the formation, performance, and dispute resolution of cross-border construction contracts, developing at the intersection of private international law and investment law . It comprises mandatory and default rules of international treaties, trade usages, general principles, judicial and arbitral precedents, as well as standards and methodologies devised by non-governmental organizations (notably FIDIC and ISO) . ICCL encompasses public-law aspects (state regulation, mandatory technical standards, permitting and supervision) and private-law elements (party autonomy, risk distribution, standard form contracts and pre-litigation procedures), aligning the interests of investors, contractors, engineers, and public authorities in major infrastructure projects .

Comparative Experience. Different jurisdictions exhibit distinctive approaches to reconciling international contract standards with local law. United States: The U.S. common law system provides flexible tools for the incorporation of FIDIC and similar international standards . Courts may consider international practice in resolving disputes, and the broad freedom of contract in U.S. law allows parties to heavily tailor standard forms to project needs . In line with precedent-based principles, the Spearin doctrine established by the U.S. Supreme Court in United States v. Spearin (1918) holds that if a contractor follows design specifications provided by the owner, the owner warrants their adequacy . This doctrine mirrors FIDIC’s allocation of design risk to the employer, illustrating how common law precedents support equitable risk-sharing in construction contracts. The U.S. legal environment strongly favors alternative dispute resolution (ADR). It is standard for contracts to include arbitration clauses, reflecting a trend to avoid lengthy litigation and reduce costs . The Federal Arbitration Act and Supreme Court jurisprudence (e.g. Mitsubishi Motors v. Soler Chrysler-Plymouth) affirm the enforceability of agreements to arbitrate, thereby upholding parties’ choice to resolve disputes outside the court system . Notably, where FIDIC contracts prescribe a multi-tier dispute resolution (e.g. Engineer’s decision followed by Dispute Adjudication/Avoidance Board (DAAB) and arbitration), U.S. courts generally honor such clauses; no fundamental incompatibility with U.S. public policy has been found as long as party consent and due process are preserved.

The professional training in the U.S. for international construction law reflects its multi-faceted nature. Most practitioners hold a Juris Doctor (J.D.) and often undertake specialized courses on Construction Contracts, International Commercial Arbitration, and Comparative Construction Law in law schools . Elite institutions such as Harvard, Yale, Stanford, and NYU offer curricula covering FIDIC contracts and dispute resolution. Practical skills are honed through institutes like the International Institute for Conflict Prevention & Resolution and the American Arbitration Association . Education in the U.S. is multi-level and competitive; students frequently gain exposure to foreign legal systems and project management through study-abroad programs . This produces lawyers adept at navigating both common law and international standards. Industry associations also play a significant role. The American Council of Engineering Companies (ACEC), the largest U.S. association of consulting engineers, is a member of FIDIC and represents U.S. industry interests globally . ACEC publishes practice guides and holds roundtables on FIDIC application . Its historical evolution (founded 1905, multiple reorganizations, and renamed ACEC in 2000) and its FIDIC membership since 1997 have given U.S. companies direct input in developing global contract standards . As of mid-2024, ACEC’s membership comprised over 569,000 professionals across the U.S. , underscoring the breadth of U.S. engagement in standard-setting. In summary, the U.S. approach, supported by precedent (including House of Lords decisions influential via common law heritage) and policy favoring party autonomy, demonstrates that FIDIC standards can be integrated provided they respect fundamental legal principles and procedural fairness.

China: China’s legal system, rooted in civil law yet shaped by socialist regulatory policies, retains strong state oversight over strategic industries including large-scale construction . International standard contracts like FIDIC are increasingly used in China, but often subject to administrative approvals and compliance with state interests . Unlike the U.S. model where private initiative and case law drive recognition of contract norms, China prioritizes administrative regulation and public interests . Nevertheless, the surge of Belt and Road Initiative projects pushes Chinese authorities toward greater use of international standards to attract foreign investors and financiers . China’s approach to human capital in ICCL differs from the U.S.: future experts typically first obtain an engineering degree, then pursue a Master of Laws (LL.M.) and often an MBA . This produces professionals with dual or triple qualifications (technical, legal, managerial), which is highly valued for managing FIDIC Silver Book EPC contracts, where technical, legal, and economic issues intersect . Top universities (Tsinghua, Shanghai Jiao Tong, etc.) have launched interdisciplinary programs covering ICCL, FIDIC and ISO standards, and domestic construction law .

China’s institutional framework to support FIDIC implementation includes the China National Association of Engineering Consultants (CNAEC), established 1992 and a FIDIC member since 1996 . CNAEC acts as an intermediary between the state and private sector, participating in drafting industry regulations, advising government, self-regulating the market, and promoting ethical standards aligned with FIDIC principles . With branches in 36 provinces and major cities, CNAEC provides an extensive network for liaising with authorities and companies . As FIDIC’s representative in China, CNAEC disseminates FIDIC standards domestically and facilitates knowledge exchange with foreign partners, evidenced by Chinese projects regularly winning FIDIC awards . A notable initiative was the establishment of a FIDIC Credentialing Service (FCS) center in Beijing in 2010 under a pilot FIDIC Certified Consulting Engineer (FCCE) program . This program, approved by the Chinese government, provides comprehensive training for professionals in ICCL and has government backing .

Chinese large infrastructure projects, especially under One Belt One Road, increasingly rely on FIDIC contracts to secure international investment and clarify risk-sharing. However, domestic mandatory norms still impose constraints: state expert review of designs, licensing of participants, multi-tier approval of project documentation, and consideration of provincial interests are required . The China International Economic and Trade Arbitration Commission (CIETAC) handles many disputes under FIDIC contracts, but if a FIDIC clause conflicts with China’s peremptory laws, national law prevails . The rising number of foreign-involved projects is gradually prompting adaptations: contract terms are tweaked to meet local law, and bilingual engineers-lawyers help bridge legal and technical gaps. Terminological consistency is also pursued—Chinese scholars emphasize careful translation of FIDIC terms to avoid confusion (Min, 2024) . For instance, the term “adjudication” has been deliberately translated to fit Chinese legal understanding. In summary, China’s model illustrates a strong government role in vetting and authorizing international standards, but with a pragmatic openness to FIDIC norms as tools of cooperation and efficiency, provided they can be reconciled with administrative law and public policy.

India: India’s legal system largely draws from English common law, boasting an extensive body of judicial precedents and contract law principles similar to the UK . This heritage includes the doctrine of freedom of contract tempered by equitable and public policy considerations. One challenge in India is its federal structure: construction regulation involves both central and state laws, which can complicate uniform adoption of standards like FIDIC. Nonetheless, Indian courts and arbitrators have shown receptiveness to FIDIC provisions. The Supreme Court of India’s landmark decision in ONGC v. Saw Pipes (2003) held that an arbitral award could be set aside if it is contrary to the “public policy of India” – a concept which has been applied to ensure that contractual provisions (including FIDIC clauses) do not violate fundamental legal tenets or economic interests of the state . Indian arbitral jurisprudence has grappled with FIDIC’s time-bar clauses (e.g. the 28-day notice requirement for claims): recent awards, subject to court review, indicate that while such clauses are enforceable, they may be struck down if deemed unconscionable or against statutory protections (such as those for small contractors). Indian construction contracts in the public sector often incorporate FIDIC-inspired terms but modified via the Public Works Department manuals to align with local contracting norms and procurement laws.

Education and professional development in India for construction law are developing. Many practitioners are engineers-turned-lawyers; the emphasis is on practical dispute resolution skills and knowledge of standard forms. Institutions like the Indian Institute of Technology-Madras offer specialized courses on construction contracts, reflecting the growing importance of this field. India’s involvement in FIDIC is coordinated through its national member association (the Indian Association of Consulting Engineers), which joined FIDIC in the mid-20th century, but its influence has been somewhat limited by diverse regional practices. Nonetheless, Indian experts participate in FIDIC committees, and India-based arbitrators contribute significantly to international construction arbitration, bridging common law principles with FIDIC’s global standards. In summary, India’s experience demonstrates a common law jurisdiction attempting to harmonize global contract standards with domestic public policy – often through judicial intervention to ensure fairness and adherence to India’s economic and legal priorities (termed “economic public order” by some scholars). The result is a cautious but growing acceptance of FIDIC, contingent on preserving regulatory stability and protecting parties against abusive terms.

European Union: In the EU, the compatibility of international contract standards like FIDIC with national law is influenced by both EU directives and member state laws. Germany provides a representative example: German law permits the use of FIDIC conditions, but they are subject to the rigorous scrutiny of the Civil Code (Bürgerliches Gesetzbuch – BGB) provisions on standard terms. If FIDIC clauses are incorporated into a contract governed by German law, courts may treat them as Allgemeine Geschäftsbedingungen (AGB) and test them against the fairness criteria of §§ 305–307 BGB (especially if used in contracts with smaller subcontractors). The Federal Supreme Court (BGH) has, in cases involving international construction contracts, emphasized that even sophisticated standard clauses must not violate the fundamental principle of Treu und Glauben (good faith) under § 242 BGB. For instance, a clause imposing an unreasonably short notification period or disproportionate penalty could be deemed void for contravening German public policy or AGB law. Furthermore, Germany’s well-developed regime of VOB/B (the Standard Conditions for Construction Contracts) – which is a set of terms often used in domestic construction – provides a benchmark for acceptable risk allocation. If parties deviate from VOB/B by using FIDIC, those deviations might invite closer AGB control unless both parties negotiated the terms (in which case, truly negotiated terms are exempt from AGB control). Additionally, compliance with public procurement law (Gesetz gegen Wettbewerbsbeschränkungen – GWB and EU procurement directives) is crucial for public projects: certain FIDIC-based design-build-operate arrangements must align with tender requirements and cannot override mandatory provisions such as contractor payment protections or design liability statutes. France, as a civil law jurisdiction, similarly subjects international contracts to ordre public scrutiny – for example, courts may refuse to enforce a FIDIC clause that they find contrary to French public policy (e.g. an overly broad limitation of liability could conflict with the Civil Code’s stance on gross negligence). Other EU countries have their nuances, but an overarching theme is the influence of EU directives (e.g. on unfair contract terms, late payment in construction, etc.) which ensure certain protective standards in construction contracts, thereby requiring adjustments to FIDIC forms. The United Kingdom, while no longer in the EU, historically influenced FIDIC’s content through its common law principles, and UK court decisions (including House of Lords rulings like Sutcliffe v. Thackrah on engineer’s liability, or Bremer Vulkan on notice requirements) are part of the common law tapestry that informs how commonwealth jurisdictions interpret FIDIC clauses. In summary, across Europe, supranational regulation and national doctrines (good faith, proportionality, consumer protection) play central roles in moderating the direct adoption of FIDIC standards, ensuring they fit within the domestic legal fabrics.

Overall, the comparative analysis shows that while the United States and China demonstrate considerable flexibility and pragmatic adaptation in integrating international standards, the European Union and other jurisdictions often require alignment with regional regulations and public policy imperatives . Successful implementation of FIDIC and similar standards globally hinges on regulatory stability, clarity in terminology, and an equilibrium between international best practices and local legal norms .

Russian Developments and Challenges. Over the past decades, Russia has undertaken significant reforms in its construction law to interface with international standards. However, these reforms have oscillated. In the late 2010s, a sweeping “regulatory guillotine” policy dramatically reduced mandatory construction requirements – from around 10,000 to 4,000 – in an effort to deregulate and streamline the industry . Government decrees in 2021 eliminated the binding nature of the majority of GOST and SNiP standards, leaving only a handful of standards mandatory . Courts correspondingly ruled that the breach of a standard not expressly made mandatory (by law or by incorporation into the contract) does not constitute a contract breach . For example, in one arbitrazh case in Moscow, the court held that reference to an outdated GOST in contract documents had no legal effect unless the contract expressly required compliance with that GOST. By May 2022, the mandatory list was pared down further to just 1 GOST and 5 Building Codes , essentially shifting to a regime where the choice of technical standards was left to the contracting parties. This contractual freedom briefly moved Russia’s practice closer to the common-law approach, making the legal environment more flexible and “contractual” in nature .

However, in August 2023, the pendulum swung back. A new Government Decree No. 417 established an official Register of Mandatory Requirements for engineering surveys, design, construction, and demolition , managed by the Ministry of Construction. This effectively re-regulated the sector: by March 2025 the register contained 609 normative documents comprising 104,179 mandatory requirements . This drastic re-expansion of mandatory norms – termed a “regulatory pendulum effect” – has reintroduced rigidity. As one commentator noted (albeit about criminal law, but apt by analogy), such situational, chaotic law-making without regard to enforcement practice leads to casuistic and gap-ridden legislation (Savenkov, 2017) . The same can be said for construction law: the overcorrection has increased complexity and may inadvertently foster legal uncertainty and even corruption. The reinstatement of almost all technical norms as mandatory means that any FIDIC-based contract clause in Russia must now align with a vast body of compulsory requirements, leaving little room for the kind of contractual flexibility seen elsewhere. This shift impacts Russia’s participation in international projects: tellingly, as of early 2025, Russia (despite being a founding member of the BRICS’ New Development Bank) had implemented only two NDB-financed projects, in contrast to China, India, and Brazil’s far greater numbers .

Another major challenge lies in terminological consistency and translation of standard terms. A prominent example is the term “Common Data Environment (CDE)”. Initially translated in Russian technical standards as “Среда общих данных” (literally “common data environment”), it was later translated in a 2023 GOST as “Единое информационное пространство” (“unified information space”), causing confusion . As of 2025, an official code of practice (SP 480) that is mandatory includes both terms inconsistently . Such discrepancies in key terminology complicate the legal framework and create ambiguities in interpretation . Chinese practice, by contrast, shows the benefit of meticulous translation and even dedicated research on translating FIDIC terminology into the local language (Min, 2024) . Russia may need a similar linguistic and terminological harmonization effort to ensure that international concepts are uniformly and accurately reflected in domestic standards.

A core substantive issue is the role of the independent engineer (consultant) in contracts. Under FIDIC, the Engineer is a neutral party administering the contract, certifying payments, and initially deciding disputes (through a DAAB) . Russia took steps to introduce this concept: in April 2011, a Vice-Premier’s directive tasked industry associations to develop standard contract forms based on FIDIC for design, survey and construction work . In November 2011, the term “Technical Client” (Tekhnicheskiy zakazchik) – akin to an owner’s representative or project manager – was introduced into the Urban Planning Code, and importantly, it allowed that role to be filled by a physical person (individual) on a professional basis or a legal entity . This was a nod to the independent consultant concept, as it meant an individual engineer could act as the technical client for a project. Academic discussions flourished on implementing FIDIC norms (Varavenko, 2020; Braig & Mutai, 2016) . However, effective 1 July 2017, an amendment (Revision 87 of the Urban Code) reversed course, mandating that a Technical Client can only be a legal entity . Since under Russia’s Tax Code an individual entrepreneur is not a legal entity , this excluded independent professionals from acting as Technical Client. As a result, implementing FIDIC’s hallmark features – the independent engineer and the adjudication mechanism – became exceedingly difficult under Russian law .

Current Russian legislation, notably the government-approved standard conditions for construction contracts (Decree No. 1066 of 29.06.2023), leaves little room for an independent Engineer-Consultant. The standard conditions effectively centralize project control in the hands of the owner (employer) or a corporate “technical client,” and they do not provide for a neutral dispute adjudicator . The contract modification process is tightly constrained by procurement law, and disputes are resolved by negotiation or litigation, without a DAB/DAAB stage. By contrast, FIDIC’s standard forms assign pivotal duties to a neutral Engineer who can make determinations and manage changes promptly . The omission of this role in Russia means the preventive dispute resolution layer is absent, potentially leading to more disputes going straight to court or arbitration with less opportunity for early resolution.

The debate on personal liability in construction is also at the forefront. Some experts argue that having individuals (rather than only companies) accountable as technical consultants prevents the dilution of responsibility – for instance, it avoids situations where a special-purpose technical company goes bankrupt post-project, leaving quality issues unaddressed . Others contend that only allowing legal entities brings advantages: legal entities can be required to meet higher financial and organizational standards, contribute to compensation funds (in self-regulatory organizations), pay minimum wages, and fulfill tax obligations, thereby offering more substantial recourse for project owners . At present, however, ICCL principles are scarcely applied in Russia. It is virtually impossible to engage an independent engineer-consultant as the technical client, and adjudication procedures (where a DAB’s decision is binding unless overturned) have no legal basis and are almost never used in practice . Importantly, a DAB is not equivalent to arbitration: it is an interim dispute resolution mechanism whose decisions are binding on an interim basis but not final awards . The lack of DAB enforceability under Russian law (no statutory recognition) means parties rarely agree to use it, knowing that any DAB decision would ultimately need to be re-litigated or arbitrated to have legal effect.

Comparative observations show that China and India have managed to effectively adapt FIDIC forms by establishing clear enforcement mechanisms and training specialized professionals . In Russia, by contrast, these mechanisms remain underdeveloped, and statutory restrictions (like the legal-entity requirement) hamper adaptation. Nevertheless, Russian legal scholars and practitioners continue to study FIDIC and advocate for changes. Sulimov (2024) notes that academia is actively examining FIDIC’s experience for domestic use . Leading construction lawyers (e.g. Dmitry Nekrestyanov of “Kachkin & Partners”) suggest that to use FIDIC in Russia, significant legislative amendments are needed regarding: (1) dispute resolution procedures; (2) variation and price adjustment mechanisms; (3) the role and status of the Engineer . They caution that Russian mandatory rules in construction (e.g. on contractual penalties, unilateral changes, etc.) may conflict with FIDIC concepts, and that even if parties choose Russian law for a FIDIC-based contract, it can lead to norm conflicts . From a broader perspective, as Zhadan (2016) argues, formal implementation of international norms is not enough; political support at the state level is crucial for effective legal cooperation . In FIDIC’s context, this means government backing could greatly accelerate integration – especially since adapting FIDIC forms to Russian law requires accommodating complex economic-legal mechanisms (analyzed by Varavenko & Niyazova, 2022) .

The study leads to a set of key conclusions and recommendations to enhance the compatibility of international and national standards in construction contracts:

1. Impact of Regulatory (In)Stability on Standard Implementation: Russia’s drastic reduction of mandatory building norms (from ~10,000 to 4,000) followed by an explosion to ~100,000 by 2025 has created a whipsaw effect of legal uncertainty, hindering the steady adoption of FIDIC and ISO standards . To mitigate conflicts, a clear demarcation between mandatory and guidance norms is required . By establishing which technical standards are compulsory and which are advisory, parties can confidently incorporate international standards without fear of hidden contradictions with domestic law.

2. Uniform Legal Terminology for Harmonization: Divergent translations of international terms lead to inconsistent enforcement. It is crucial to standardize terminology in legislation. For example, “Common Data Environment (CDE)” should be legislatively fixed under one term (e.g. “Среда общих данных”) as the sole correct translation, replacing alternatives like “Единая информационная среда” which deviate from international usage . Ensuring terminological consistency will improve clarity and alignment between Russian standards and global ones.

3. Adjusting Liability Regime in Construction Law: Since 2017, Russia has shifted away from personal liability of technical experts toward an all-corporate liability model, which diverges from international practice and undermines legal quality guarantees . To restore balance, it is recommended to amend Urban Planning Code Art. 22 to allow a qualified individual (including sole proprietor) to act as a Technical Client . Reintroducing the possibility of an independent professional in this role would enable FIDIC’s independent Engineer concept and adjudication mechanism (DAAB) to function in Russian projects. It would also reinforce personal accountability, deterring scenarios where thinly capitalized firms escape liability post-project.

Implementing these recommendations in concert will significantly improve the synergy between international standards and Russian law, reducing legal disputes and increasing the competitiveness of Russian companies in global markets . Clearly segregating mandatory rules, harmonizing legal vocabulary, and reinstating the independent technical consultant as a recognized actor will create a more predictable legal environment for infrastructure projects. Crucially, these steps do not sacrifice national sovereignty; rather, they streamline cross-border project execution, facilitate foreign investment, and ease cooperation with international financial institutions like the NDB. In sum, advancing legal harmonization in this domain – informed by precedent (common law and civil law), guided by principles of proportionality and good faith, and supported by political will – will foster a more stable and fair construction contract regime, benefiting all stakeholders.

The multipolar configuration of the contemporary international order and the intensifying pressure of sanctions have radically complicated the architecture of international construction contracts: they now reach far beyond technical and commercial matters, integrating politico-legal, economic and administrative dimensions. This is clearly reflected in the practice of Russian participants in cross-border projects, for whom the choice of governing law and an arbitration clause often results in proceedings in London—as illustrated by case No. A56-111059/2024, where the national court declined jurisdiction due to the parties’ contractual submission to English law and forum. Against this backdrop, scholarly attention shifts toward coercion: its typology in large construction and infrastructure projects and the toolkit for reducing the risks of abusive pressure.

In public international law doctrine, coercion is regarded as one of the central threats to the stability of the legal order because it leads to violations of norms and the rights of the parties and assumes diverse forms—from economic pressure and restrictions on access to resources to threats of the use of force (Lukashuk, 2004). A comparable conclusion is reached in foreign scholarship, which underscores the need to refine existing norms and ensure their effective enforcement to protect the interests of actors in transnational projects (Kolb, 2017). Sanctions, as a public-law instrument, simultaneously function as a mechanism for pursuing the objectives of the international legal order and as a field of competing interests; their ambiguous application can become a lever of pressure on counterparties, including by inducing them to revisit or terminate contractual relations (Rusinova, 2017). In contemporary comparative discourse, economic and other forms of pressure emerge as factors that unbalance the allocation of risks, thereby threatening the fairness of contractual relations and revealing the need for unified legal tools protecting against unlawful pressure (Milanovic, 2023). International organisations and arbitral systems are intended to curb abuses and ensure fair dispute settlement, which requires effective standards preventing the improper use of coercion (Helal, 2019).

The Russian scholarly debate in the field of international construction contracts already provides baseline guidance on normative requirements for contractual clauses and on procedural aspects of dispute resolution in international commercial arbitration (Anosov, 2024; Sapozhnikova & Khusainova, 2021). A special place is occupied by the question of adapting the standard contracts of the International Federation of Consulting Engineers (FIDIC) to national law—comparative analysis reveals their potential as instruments to counter abusive pressure when properly localised (Varavenko, 2021). In a broader theoretical frame, the development of a multipolar world affects the content and mechanisms of international agreements, including construction contracts, as shown in studies on the legal foundations and problems of the emerging multipolar order (Lisitsyn-Svetlanov, 2024).

Arbitral practice demonstrates the key forms and mechanisms of pressure. In Dirk Herzig as Insolvency Administrator over the Assets of Unionmatex Industrieanlagen GmbH v. Turkmenistan (ICSID Case No. ARB/18/35), requirements to perform additional works without funding guarantees and other discriminatory measures led to the contractor’s insolvency; here indirect economic coercion manifested itself through the imposition of costs amid defective financing and administration. In Jan de Nul N.V. and Dredging International N.V. v. Arab Republic of Egypt (ICSID Case No. ARB/04/13), insufficient disclosure of baseline data on soil composition and volume shifted the risk to the contractor; although no intent to defraud was established, the informational asymmetry nonetheless revealed a latent coercive effect. The case L.E.S.I. S.p.A. and ASTALDI S.p.A. v. République Algérienne Démocratique et Populaire (ICSID Case No. ARB/05/3) reflected politico-administrative coercion: the state’s emergency measures, financing constraints and heightened security requirements effectively compelled the contractor to proceed under adverse conditions, while gaps in force-majeure risk allocation increased the private party’s vulnerability. In Muhammet Çap & Sehil İnşaat Endüstri ve Ticaret Ltd. Şti. v. Turkmenistan (ICSID Case No. ARB/12/6), a combination of arbitrary fines, restrictions on removing equipment, the imposition of unpaid works and prosecutorial oversight exemplified direct state coercion, aggravated by the state’s dual role as both employer and regulator. The decision in Salini Costruttori S.p.A. and Italstrade S.p.A. v. Kingdom of Morocco (ICSID Case No. ARB/00/4) conferred investment status on construction contracts where the “Salini test” is met, thereby expanding the protective perimeter against unilateral changes by a public employer. Finally, in COMMISA v. Pemex (ICC Case No. 13613/CCO/JRF), the state entity’s unilateral “administrative rescission” and the subsequent setting aside of the arbitral award in the national forum were counterbalanced by recognition and enforcement of that award by U.S. courts, revealing the limits of public-law prerogatives of a state employer vis-à-vis international obligations of good faith and an arbitration agreement.

Taken together, this practice permits a typology of unlawful coercion in international construction contracts: economic pressure (e.g., non-payment; imposition of additional works without compensation); administrative measures (prolonging permitting procedures; discriminatory conditions; unilateral termination); legal collisions (annulment or obstruction of award enforcement under the rubric of “public interest”); political factors (regional instability; external risks requiring uncompensated technological changes). A common denominator is the insufficiency of preventive safeguards and the deficit of fast-track settlement procedures, especially when interacting with state actors.

From a historical-theoretical perspective, the special nature of international responsibility is well established. Nihilistic concepts denying state responsibility toward other subjects have been overcome through the evolution of doctrine and practice; responsibility has come to be understood as an immanent attribute of law, without which legal order loses coherence. Early approaches analogous to the civil-law logic of damage compensation gradually yielded to a broader vision encompassing restoration of legal order and prevention, beyond purely material components of violations (Pradier-Fodéré & Pradier-Fodéré, 1906; Evans, 2014; Martens, 2008). The culmination of decades of codification—“Responsibility of States for Internationally Wrongful Acts” (UNGA Resolution 56/83 of 12 December 2001)—confirmed the sui generis character of the institution and the need for a holistic approach that accounts for the specificity of public authority, the horizontal nature of inter-state relations and the absence of a centralised enforcement apparatus (Gasanov & Shalyagin, 2012; Keshner, 2016; Bazylev, 1985; Ivanov & Ivanov, 2006; Lazarev, 2005).

Sanctions as an instrument of international law possess a compulsory character ensured by collective enforcement within multilateral frameworks (Rusinova, 2017). Their public-law nature implies that states and international organisations are the initiators and bearers of coercive authority, while the operative norms must be formally defined and publicly accessible. In infrastructure projects, sanctions regimes affect access to materials and equipment as well as supply and finance chains, which directly shape the risk profile and stability of the contract. In this sphere, sanctions are not only punitive but also safeguarding mechanisms that support compliance with international obligations and the balance of parties’ interests (Tupchienko, 2024).

In the absence of a supranational “enforcer”, arbitration has a central role. The effect of the New York Convention, investment treaties and procedural reforms manifests in greater predictability of award enforcement; yet, particularly in disputes involving state entities, challenges persist relating to immunities and public policy (Orlov & Yarkov, 2017; Galenskaya, 2010). This pushes toward strengthening contractual mechanisms: precise arbitration agreements, enhanced binding force for public employers, and pre-agreed procedural roadmaps for enforcement.

The FIDIC standard conditions are a key practical tool for risk mitigation. Their structure allocates risks in detail, introduces staged notifications and changes, and provides sequential dispute-resolution means. With respect to economic and administrative pressure, transparent procedures for adjusting time and price, documented notices and time-bar regimes minimise interpretive variance over the parties’ powers and opportunities to impose uncompensated works. Russian and foreign scholarship underscores the effectiveness of these mechanisms when properly localised: from comparative analysis of EPC/EPCM and construction contracts (Lavrenyak, 2023) to specific studies on compensation for property losses and the applicability of on-demand and other security instruments in Russian practice (Lyapustina & Rybka, 2024). The efficacy of pre-arbitral mechanisms is further supported by works on the enforcement of DAB/DAAB decisions, which stress the need for reliable enforcement procedures and even proposals to adjust the convention framework to protect their effect (Dedezade, 2021; Anisi, 2021).

Given the politico-legal dynamics of cross-border projects—including in energy—there is a growing demand to reconcile public and private-law objectives. This is reflected in domestic studies on investment disputes and on mechanisms for protecting foreign investment, which outline a normative model oriented toward balancing public interests with the stability of private expectations (Lisitsyn-Svetlanov, 2021; Matveev, 2022). In practical terms, such a model entails: (1) contractual stabilisation and compensation mechanisms for sanction and force-majeure shocks; (2) clear protocols for baseline data disclosure and risk reallocation upon changes; and (3) mandatory multi-tier dispute-resolution procedures, including prompt DAAB decisions and arbitration with a pre-set cross-jurisdictional enforcement roadmap.

The conclusion, supported by doctrine and arbitral practice alike, is that the risks of economic and administrative pressure can be mitigated by prioritising transparent procedures for modifying contractual terms, strict documentation of notices and a reasonable allocation of risks embedded in FIDIC standard forms with localised special conditions; this approach reduces the likelihood of opportunistic reallocation of obligations and the emergence of uncompensated works (Lavrenyak, 2023; Lyapustina & Rybka, 2024; Dedezade, 2021; Anisi, 2021). At the same time, legal-political risks cannot be eliminated by contractual instruments alone: inter-state agreements and the harmonisation of investment-law guarantees are needed to establish reproducible behavioural frameworks for public actors and to erect barriers against “administrative rescission” and analogous practices undermining good faith in the contractual sphere (Lisitsyn-Svetlanov, 2021; Matveev, 2022).

Overall, the picture indicates three avenues for development: the unification of anti-coercion norms in both soft- and hard-law formats with the participation of international organisations; institutional strengthening of rapid dispute-resolution mechanisms involving state employers and ensuring the practical enforceability of decisions; and systematic localisation of FIDIC standard conditions into national systems, with due regard to public-law constraints and infrastructure priorities. Implementing this programme will enhance the predictability and resilience of international construction projects, increase the parties’ trust and reduce transaction costs.

International construction projects inevitably intersect multiple legal systems and norms of international law. The legal regulation of such contracts depends on the sources of contract law in the specific jurisdiction, as well as the application of international jus cogens norms, which may not be derogated from. Jus cogens — peremptory norms such as prohibitions against genocide or slavery — are binding upon all States, and any contractual arrangement that contravenes such norms is void ab initio. Nevertheless, the influence of jus cogens on ordinary commercial contracts is indirect: it sets outer boundaries for party autonomy and prohibits agreements that undermine the foundational principles of the international legal order.

Different legal traditions — common law (precedent-based), continental civil law (codified), Latin American public-law systems, and Israel’s mixed jurisdiction — diverge in their sources of contract law and mechanisms of protection in international construction contracts. The four localised versions of Chapter 10 of the monograph “International Construction Contract Law” — “Treaty Law in International Construction Contracts: Legal Challenges and Protective Mechanisms” — reflect these differences. Each version takes into account:

(1) the specific sources of obligations and peremptory international norms;

(2) the practical use and local application of FIDIC standards;

(3) available remedies in case of breach (international arbitration, ISDS, national judicial recourse, forum selection);

(4) doctrinal foundations for the recognition of treaty-based obligations in the construction sector;

(5) the legal treatment of sanctions, force majeure, hardship, and project-time contractual adaptation;

(6) the State’s role as employer, funder, regulator, and respondent;

(7) interpretative doctrines (e.g. differences between civil law and common law in construing contract texts).

Sources of contract law and jus cogens. In Anglo-American common law (e.g., England and the United States), contract law is grounded primarily in judicial precedent and targeted statutes rather than a comprehensive civil code. Party autonomy is robust but cabined by public-policy and illegality doctrines. Peremptory norms of international law (jus cogens) are not directly part of domestic contract doctrine; they operate as outer boundaries: a contract that contradicts such norms (e.g., corruption, slavery) will not be enforced on public-policy grounds (Shelton, 2011). Agreements requiring unlawful acts or violating human rights are void. Absent those fundamental limits, parties are generally free to allocate risk as they wish and courts will enforce the bargain. Common law has developed frustration and illegality to deal with supervening events or unlawful contingencies, ensuring parties are not compelled to act in ways fundamentally inconsistent with law or public policy (Sloss, 2009). There is no overarching code-based hardship rule: without a clause, performance is expected; frustration applies only in exceptional cases. In the United States, self-executing treaties or those implemented by Congress may become part of the “supreme Law of the Land” (U.S. Const. art. VI), yet most treaty norms (apart from arbitration/investment protection) do not govern private construction contracts unless incorporated. In England’s dualist system, treaties require an Act of Parliament for domestic effect; the ICSID Convention was implemented by the Arbitration (International Investment Disputes) Act 1966 (Sloss, 2009). The Vienna Convention on the Law of Treaties binds states, not private parties—unless domestic law incorporates treaty-based rules (e.g., safety standards, sanctions) that then affect contracts (Shelton, 2011).

Application of FIDIC. FIDIC standard forms are widely accepted across common-law jurisdictions as a pre-eminent set of international forms for large infrastructure and engineering projects (Seppälä, 2023). Anglo-American practice frequently uses FIDIC (and NEC/JCT) because of balanced risk allocation and mature administration mechanisms. Courts generally enforce FIDIC clauses as written unless they conflict with mandatory local law. Core features—Engineer’s determinations and the DAAB—are recognised as contractual mechanisms; time-bar regimes and interim/final-binding DAAB decisions are enforced according to the agreed text and governing law (Seppälä, 2024).

Protection mechanisms (forums and remedies). Parties typically select arbitration; London and New York remain leading seats. The New York Convention 1958 underpins recognition/enforcement subject to limited defences, including public policy (Sloss, 2009; Shelton, 2011). Where the counterparty is a state, ISDS via BITs and the ICSID Convention allows investors to arbitrate directly; Article 54 requires recognition of monetary obligations “as if a final judgment,” with no merits review by domestic courts (Sloss, 2009). DAABs provide interim relief within FIDIC; courts support compliance with such contractual steps pending final arbitral resolution (Seppälä, 2024).

Doctrinal basis for recognising treaties. The common-law world differentiates between international and domestic law. The UK requires parliamentary implementation; the U.S. allows some self-executing treaties, but construction contracts are affected chiefly when instruments are incorporated by the parties. Soft-law instruments (UNIDROIT Principles, ICC rules) bind only by choice. Treaty frameworks—FTAs and BITs—supply a background of procurement transparency and investment protection that fosters fair contracting and transnational recourse (Sloss, 2009; Shelton, 2011). Customary international law may inform the common law unless displaced by statute (Shelton, 2011).

Sanctions, force majeure, hardship, change of circumstances. Common law lacks a general hardship doctrine; instead, frustration (UK) and impracticability (U.S.) excuse performance only at a high threshold. Force-majeure is contractual; the clause governs, and supervening illegality (e.g., sanctions) may discharge performance if no clause exists (Sloss, 2009; Shelton, 2011). Parties in international projects often adopt FIDIC-style force-majeure and hardship wording; courts enforce it as agreed (Seppälä, 2023).

Role of the State. Public employers are generally subject to ordinary contract law, with sovereign immunity limited for commercial acts and where consent to jurisdiction/arbitration is given. Government contracts often include statutory or standard clauses (changes, termination for convenience). Regulatory acts that render performance illegal may ground frustration/force-majeure analysis. Breaches vis-à-vis foreign investors can trigger treaty claims in parallel with contractual claims (Sloss, 2009).

Approach to interpretation (common law vs civil law). Interpretation emphasises the text in its commercial context; the parol-evidence rule limits extrinsic material. English law distinguishes interpretation from implication; there is no overarching duty of good faith as in many civil codes, though business efficacy may justify implying terms in fact. Technical FIDIC terminology is read per industry usage; mandatory local law prevails in case of conflict (Shelton, 2011; Seppälä, 2023).

Sources of contract law and peremptory norms. Germany’s contract law, as a civil-law system, is codified—principally in the BGB. Since 2018, construction contracts are expressly regulated in §§ 650a et seq. BGB (earlier, the general law of work contracts—§§ 631 et seq.—applied). In practice, construction projects rely on standard terms—above all VOB/B—which functions as widely used general conditions, not as legislation, but operates as a quasi-standard because of its balanced drafting. In public procurement, incorporating VOB/B is common and in many settings required, so public employers typically attach VOB/B to building contracts. This yields a dual architecture: the BGB supplies the mandatory framework (good faith, § 242; change in circumstances, § 313), while VOB/B delivers granular, practice-oriented clauses. Jus cogens in the sense of public international law influences German contract law indirectly via ordre public: terms violating fundamental principles or good morals are void under § 138 BGB; corruption-tainted or rights-violating bargains fail on public-policy grounds (Shelton, 2011). Germany is dualist: treaties operate domestically only if transformed by statute or published with the force of law; at the same time, Article 25 of the Basic Law incorporates general rules of international law (custom) into the domestic order. Awards or foreign judgments contrary to jus cogens will not be enforced (Shelton, 2011).

FIDIC in practice. Domestically, VOB/B predominates; FIDIC is primarily relevant to outbound projects by German contractors. Where German law governs, parties often tailor FIDIC to BGB concepts; the Engineer’s role is mapped to the statutory change mechanism (§ 650b BGB) or contract-defined project management. DA(B)B clauses are less familiar to German litigation culture but can be enforced as contractually agreed interim determinations pending arbitration (Seppälä, 2023; Seppälä, 2024). Mandatory BGB rules prevail over conflicting FIDIC text (e.g., no exclusion of liability for intent, § 276(3) BGB).

Protection mechanisms (ISDS, courts, fora). Construction disputes are litigated in the ordinary civil courts (Landgerichte) or arbitrated. Germany is arbitration-friendly: §§ 1025–1066 ZPO reflect the UNCITRAL Model Law; the New York Convention governs recognition with narrow public-policy defences (Sloss, 2009). Early fact-finding through independent evidence proceedings (§§ 485 et seq. ZPO) is common. Internationally, German investors rely on BITs and the ICSID Convention; domestically, ICSID awards are recognised without merits review, consistent with Article 54 (Sloss, 2009).

Doctrinal basis. Treaties bind in Germany through legislative implementation; general international law applies ex Article 25 of the Basic Law. EU law shapes procurement and competition frameworks, projecting transparency and equal-treatment norms into construction contracting. Soft-law instruments may guide arbitral interpretation if chosen.

Sanctions, force majeure, hardship. German law addresses impossibility (§ 275 BGB) and disturbance of the basis of the transaction (§ 313 BGB). “Force majeure” is judge-made: external, unforeseeable, unavoidable events. Supervening illegality (e.g., sanctions) may trigger § 275; severe economic distortion may justify adaptation/termination under § 313. VOB/B contains tailored time-extension and termination tools.

Role of the State. The State typically contracts under private law; sovereign immunity does not bar claims arising from commercial acts. Public-law review exists in procurement and permitting. Unilateral administrative variation of private contracts is limited to statutory/contractual bases; pacta sunt servanda applies to public entities.

Interpretation and application. Sections 133 and 157 BGB prioritise true common intent and good faith; German courts may depart from literal wording where necessary and control standard terms under § 307 BGB to prevent undue imbalance.

Sources of contract law and peremptory norms (jus cogens). Across Latin America, civil-law systems codify contract rules in civil and commercial codes, while administrative law exerts strong influence over public-works arrangements. A structural divide persists between private contracts (civil/commercial) and administrative contracts (state–private, governed by special public-law rules). Fundamental sources include constitutions (entrenching, in many states, economic public order, the social function of contract, and the supremacy of the public interest), local civil codes, and sectoral public-procurement statutes for state contracts. In Mexico, Colombia, and Peru, procurement statutes and regulations prescribe mandatory procedures and clauses for state contracting; such provisions are matters of public order and override party autonomy. French-derived doctrines—unilateral modification and unilateral termination for public interest—are characteristic, coupled with a duty to indemnify the affected contractor. Many Latin-American constitutions accord treaties supra-statutory rank, and some (e.g., Argentina) confer constitutional hierarchy on core human-rights treaties; international jus cogens thus filters directly into domestic law. Construction agreements implicating human-rights violations (forced labour, severe environmental harm) would be invalidated not only by local law but also by constitutional/international mandates. Transnational public policy surfaces in investment arbitration to police corruption or fraud, with potential non-enforcement/annulment of awards (Calvo, 1868). Calvo’s nineteenth-century doctrine—foreigners should litigate under local law in local courts without diplomatic protection—long shaped constitutions and statutes, tempering international adjudication in favour of sovereignty (Calvo, 1868). Today, BITs and ISDS have diluted strict Calvo, yet an instinct for local solutions and jurisdictional sovereignty remains.

FIDIC application. FIDIC standard forms have spread as international best practice. Historically, domestic general conditions governed, but MDB financing (World Bank, IADB, CAF) promotes FIDIC on large schemes. Red/Yellow/Silver Books are increasingly adopted, with careful localisation. The Engineer’s neutral-administrator role is being grafted into systems where a resident supervisor traditionally represents the owner. DAB/DAAB decisions, provisionally binding under FIDIC, are new to many jurisdictions yet now appear in major concessions and PPPs, typically followed by international arbitration for confirmation. Legal-language alignment is key; certain FIDIC clauses must be adapted to public-order ceilings on unilateral changes and to termination-for-convenience by the administration, usually inserted as Particular Conditions with compensation.

Protection against breach (ISDS, local remedies, fora). Contractors avail themselves of domestic courts (interim relief, expedited tracks) and increasingly of arbitration; several states mandate arbitration in public procurement. The 1958 New York Convention applies region-wide; the 1975 Panama Convention further facilitates recognition. Cross-border construction contracts commonly stipulate ICC/UNCITRAL/ICSID arbitration; ISDS remains central for concessions/PPPs notwithstanding episodic withdrawals from ICSID by some states. Administrative-law remedies persist against unilateral acts (termination, fines) and often require prior administrative claim.

Doctrinal basis for treaties. Many states follow moderated monism: ratified treaties form part of domestic law (sometimes via a “block of constitutionality”). Courts may directly apply treaty norms (e.g., prior consultation with indigenous communities). Arbitration clauses with the state are treated as valid waivers of jurisdictional privilege. The economic-financial equilibrium principle aligns with FET-type protections; police-powers doctrine and necessity clauses delineate the state’s regulatory space.

Sanctions, force majeure, hardship. Civil-law imprevisión (hardship) authorises judicial adaptation/termination where extraordinary, unforeseeable events upend contractual equivalence; force majeure is codified and excuses liability and delays. International sanctions are treated as supervening illegality or as grounds for adjustment; contracts increasingly include express sanctions clauses and suspension mechanisms. Public-works “variation” regimes permit ordered changes up to statutory percentages with time/price adjustments.

Role of the State. The State wields exceptional clauses (ius variandi/rescindendi) yet owes compensation to preserve equilibrium. Modern PPP statutes (Mexico, Chile, Brazil) regulate prerogatives and safeguards (arbitration, technical boards, insurance) to enhance predictability. Execution immunity for public assets endures; enforcement targets commercial assets/budgetary processes.

Interpretation. Latin-American adjudication prioritises common intent, objective good faith, and causa/finality; extrinsic evidence is admissible; statutory default rules fill gaps. The interpretive aim is to preserve the contract and restore balance, resisting outcomes that offend good faith.

Cross-border infrastructure contracts increasingly shape diplomatic leverage within an emerging multipolar order. The chapter applies comparative legal analysis of the 1980 United Nations Convention on Contracts for the International Sale of Goods (CISG), the UNIDROIT Principles, FIDIC standard forms and the U.S. Foreign Corrupt Practices Act (FCPA). Conflicts of law, jurisdictional ambiguities and reputational risks are identified, showing how standardised contract terms and sustained consular engagement mitigate them. Ten pragmatic diplomatic mechanisms—from multilateral bank coordination to a coherent global infrastructure brand—are distilled to reinforce predictability and investor confidence. Integrating contract doctrine with external-relations law, the study evidences that diplomacy, arbitral practice and compliance frameworks jointly reduce legal uncertainty and catalyse cooperation.

International construction projects, amid accelerating integration processes in an increasingly multipolar world, acquire strategic significance by substantially influencing both the economic development of states and the strengthening of their diplomatic relations. The implementation of large infrastructure projects—oil and gas pipelines, ports, transport networks, energy facilities—is predominantly carried out by transnational construction companies, which inevitably affects the interests of multiple states and requires coordination at the level of international law.

International law serves as a key instrument in regulating cross-border construction contracts, providing the legal foundation for interaction between states and transnational companies. A study by Ya. A. Anosov (2022) demonstrates that integration processes within the EAEU facilitate improvements in the legal regulation of international construction contracts, which is important for contemporary cross-border projects. Furthermore, research by D. I. Imamova (2023) confirms that the concept of an “international construction contract” remains insufficiently defined in legislation, creating difficulties in dispute resolution and necessitating further refinement of legal mechanisms in this field. In the context of building a multipolar world, there is a growing need to harmonise legal norms and standards in the construction sector, which contributes to the harmonisation of international relations and the reduction of legal uncertainty.

International agreements such as the 1980 CISG and the UNIDROIT Principles of International Commercial Contracts play a decisive role in forming the global legal infrastructure for regulating international construction contracts. These instruments aim to establish universal standards in cross-border trade and contractual relations, simplifying the process of concluding contracts between parties from different jurisdictions. The significance of these documents lies in their ability to adapt to the dynamic conditions of the international construction market, ensuring that legal regulation remains up-to-date and flexible. Moreover, these agreements contribute not only to the harmonisation of legal norms but also to a significant reduction of legal uncertainty when concluding construction contracts between parties from different states. Standardising provisions on the parties’ rights and obligations, procedural requirements, and consequences of contractual breaches minimises potential conflicts, ensures predictability of contract performance and strengthens trust among participants of international construction projects. As V. N. Zhadan notes in his study, such agreements decrease the likelihood of disagreements at the level of state authorities and foster mutual understanding between countries, which in turn promotes the development of international cooperation in construction and the strengthening of stable interstate relations. It should be noted that an important aspect of these international instruments is their impact on diplomatic relations between states, since they create a legal basis for resolving potential disputes, including those related to cross-border construction projects.

Despite a considerable number of studies devoted to the law of external relations as a branch of international law (including its sub-branches of diplomatic and consular law), the need to further examine their influence on the practical aspects of international economic relations remains pressing. In the context of executing cross-border construction projects, the role of diplomatic and consular mechanisms aimed at protecting the rights of citizens and legal entities abroad is increasing. Such measures are particularly important for minimising risks and preventing potential conflicts in the international legal environment.

The dissertation of G. H. Y. Al-Faki thoroughly elucidates mechanisms for enhancing mutual understanding between states through diplomatic protection and consular assistance for citizens abroad. Diplomatic protection and consular support help elevate the level of responsibility of host states towards foreign investors and contractors, thereby creating a favourable environment for conducting cross-border business. Al-Faki’s study emphasises that diplomatic measures can significantly improve interaction between parties to international contracts, affecting the legal and economic conditions of their performance. The researcher concludes that diplomatic and consular measures, as part of a comprehensive international legal system, have the potential to strengthen diplomatic relations between countries. Effective use of these measures in the context of cross-border construction will not only protect participants’ rights but also help maintain stable and predictable international relations, which is an important factor in regulating construction contracts between states.

Moreover, research by H. Besaiso and co-authors shows that international arbitrators pay considerable attention to both contractual provisions and commercial norms, indicating the need for a comprehensive approach to dispute resolution in international construction. As J. Fitzmaurice correctly notes, such approaches strengthen legal stability and uphold the interests of all parties. The importance of arbitration mechanisms is also examined in the research of J. Jenkins, which underscores the role of arbitration as the primary method of dispute resolution in international construction projects. Additionally, according to the International Bar Association (IBA), robust compliance standards create a foundation for increasing trust and transparency between parties to international contracts, which is especially crucial in large infrastructure projects.

Modern studies indicate the need to bolster the role of Russian diplomatic and consular institutions in an era of heightened international political tension, as they provide legal protection for citizens and organisations involved in cross-border construction contracts and safeguard Russia’s national interests abroad. Contemporary scholarship points to the need to strengthen diplomatic and consular mechanisms in regulating cross-border projects, as evidenced by developments in diplomatic law towards greater standardisation and codification. It is telling that A. H. Abashidze, in his textbook, devotes significant attention to issues of codifying diplomatic norms. Historical evolution of the legal foundations of external relations—from the Vienna Regulation of 1815 to the Vienna Conventions of 1961, 1963 and 1975—confirms the necessity of further codification of norms. These instruments established a solid legal foundation for the diplomatic and consular protection of participants in cross-border projects, which greatly improved inter-state cooperation.

Regulating cross-border construction contracts through diplomatic and consular mechanisms requires clear coordination at all levels. Experience shows that the effectiveness of such mechanisms is directly linked to the codification of the legal status of consular and diplomatic institutions. This is confirmed by researchers who note the significance of diplomatic support in creating favourable conditions for international cooperation.

Awareness of the role of state bodies and officials in implementing international contracts also plays a key role. As V. A. Zorin rightly asserts, clear allocation of responsibilities among participants in the diplomatic process contributes to increased efficiency of interaction between countries involved in cross-border projects. This minimises legal conflicts and strengthens trust between parties, which is especially important in the context of global infrastructure initiatives.

In regulating cross-border construction contracts, protecting state sovereignty and national interests is of particular importance for Russia. Research by I. Yerniyazov (2023) demonstrates that synergy between international construction contracts and investment treaties helps harmonise commercial and public interests, which is a critical aspect of modern foreign policy strategy. This is directly tied to the need for diplomatic support and oversight of cross-border construction projects, which serve not only as commercial undertakings but also as tools for strengthening national security and the country’s prestige on the world stage. Successful cooperation between state agencies and subjects of international law is a key factor for the effective execution of such projects, which often require coordinated efforts not only domestically but also at the inter-state level, implying close coordination with various international organisations and sometimes unfriendly actors. This conclusion is supported by V. N. Zhadan, who writes that to ensure stability in international relations and protect national interests, Russia must actively engage with European international organisations despite existing problems and contradictions (Zhadan, 2016).

State sovereignty necessitates control over foreign economic relations, including infrastructure projects that often attract foreign investors and contractors. The implementation of such projects entails not only legal support but also diplomatic coordination to protect the interests of Russian companies abroad and ensure their legal security. This conclusion is corroborated by V. A. Nikonov, who notes that maintaining national sovereignty and protecting the country’s economic interests require creating legal conditions that minimise foreign interference in key aspects of cross-border projects (Nikonov, 2014).

To achieve these goals, Russia is developing a system of diplomatic support aimed at accompanying large infrastructure projects outside its national jurisdiction. Diplomatic protection not only minimises the risks of legal and economic conflicts but also strengthens the state’s sovereignty through effective regulation of cross-border contractual relations. In this context, studies by M. K. Gunar confirm that such coordination between diplomatic departments and commercial entities contributes to the development of long-term cooperation with international partners, while simultaneously protecting national interests (Gunar, 2015).

The strategic orientation of the Russian Federation’s foreign policy course is enshrined in a series of Presidential decrees. Diplomatic support for cross-border construction contracts creates conditions for promoting Russian interests in strategically important areas such as energy, transport, and defense infrastructure. These projects not only bolster Russia’s economic position in the global market but also form the basis for establishing long-term partnerships with foreign states. Diplomatic oversight ensures the resilience of such projects, strengthens Russia’s international standing, and maintains a balance between global integration and national priorities.

Ten mechanisms for strategically promoting national construction companies through consular and diplomatic channels

As a result of this study, ten mechanisms have been formulated to support the expansion of national construction companies at the international level. These mechanisms can be recommended to the Russian Ministry of Foreign Affairs to improve the practices of Russian diplomatic missions and consulates abroad:

1. Active support via banks with state participation. This refers not so much to domestic banks, which already actively finance Russian overseas initiatives and companies in international construction projects, but to targeted efforts by diplomatic services to engage with the BRICS New Development Bank (NDB). The primary task of foreign missions should be to assist Russian construction companies in securing participation in every construction tender financed through the NDB. As of January 2025, out of 122 NDB projects (excluding projects within Russia), Russian contractors were not listed in any tender, even though Russia contributed one-fifth of the NDB’s capital.

2. Refocusing bilateral forums and initiatives to overseas venues instead of domestic ones. Russian consular and diplomatic efforts to support national construction companies abroad are mainly concentrated on organising forums and business meetings in Russia, where representatives of African and Latin American countries are invited. This approach limits opportunities for direct engagement with local authorities and businesses on their home turf, reducing the effectiveness of promoting Russian firms in international construction projects. In contrast, China actively utilises bilateral forum formats such as FOCAC (Forum on China–Africa Cooperation) and the China–CELAC Forum, which are frequently held in African and Latin American countries. This allows Chinese diplomacy to forge closer ties with local partners, swiftly negotiate contract conditions, and ensure support for its companies in competitive environments.

3. Emphasis on a single large-scale and recognisable global infrastructure initiative. Russia, as the world’s largest country and a key Eurasian transit hub, should create a unified global infrastructure brand, analogous to China’s “Belt and Road” initiative. In this regard, the proposed “Eurasian Infrastructure Corridor” (EIC) would integrate projects such as the North–South Transport Corridor (connecting Russia–Iran–India–Persian Gulf), the modernisation of the Trans-Siberian Railway, railways in Mongolia and routes linking Russia–China–Central Asia, as well as the development of the Northern Sea Route as an alternative to the Suez Canal and the Northwest Passage between Greenland and Canada promoted by the USA.

4. Establishing a coordination system for sending Russian engineers and managers to international projects. The depreciation of the ruble over recent decades has made Russian specialists more competitive in the global market: whereas in the early 2000s their salaries exceeded those of Chinese counterparts, by the 2010s they were on par, and after the 2020s they became half as high. This creates conditions for the organised involvement of Russian engineers in overseas construction projects with subsequent repatriation of capital. However, without institutional support, this process risks turning into uncontrolled emigration. Unlike China, where consulates coordinate the movement of labour and equipment, Russia lacks a centralised diplomatic structure for such tasks. The MFA must simplify visa procedures, protect labor rights, and facilitate engagement with international contractors so that Russian specialists work abroad in the national interest rather than leaving the country permanently.

5. Diplomatic guarantees for long-term project support. For foreign clients, a contractor’s country of origin plays a key role in building trust, and instances of non-performance by some Russian companies undermine the reputation of the entire industry abroad. At the same time, self-regulatory organisations (SROs), despite mandatory member contributions, do not assume responsibility for finding substitute contractors, completing projects, or compensating damages, which prevents rapid mitigation of negative outcomes. The Russian MFA should develop a mechanism of transparent guarantees for the long-term servicing and support of completed projects, and diplomatic missions should strive to include such conditions in international agreements and tender requirements. This would enhance the competitiveness of Russian companies and strengthen their reputation in the global market.

6. A system for targeted recruitment of foreign students for Russia’s strategic projects abroad. To ensure staffing for Russian infrastructure initiatives overseas, it is necessary to link the education of foreign specialists in Russian universities to specific projects where Russia has strategic interests. The MFA should implement a mechanism whereby diplomatic missions promote specialised educational programs and coordinate student intake based on the needs of particular sectors. For example, for mining projects in South Africa – attract students to geology and exploration programs (at the Russian State Geological Prospecting University), or for constructing aviation plants and transport infrastructure in Indonesia – programs at the Moscow Aviation Institute. This approach will train personnel oriented towards Russian technologies, increasing the competitiveness of domestic companies when their tenders are considered abroad. Notably, this strategy is already employed by China: with the involvement of its diplomatic missions, it organises professional courses and internships for local engineers and managers in China, including government scholarship programs.

7. Institutional support for state-owned construction corporations. At the government level, the approach to promoting Russian state-owned construction companies abroad should be reconsidered, given that short-sighted management decisions can lead to the dissolution of unique organisations with global reputations (e.g. the disbanding of Spetsstroy Russia in 2016). This experience contrasts with China’s policy, which actively supports its “construction giants” like CSCEC by facilitating the opening of their foreign branches, granting benefits, and establishing close ties with foreign governments and business communities. If Russia reestablishes large state contractors capable of handling major infrastructure projects (such as building seaports, cosmodromes, nuclear energy facilities) and provides them with systematic diplomatic support, national companies will be able to compete more effectively on the global construction market and enhance the country’s image.

8. Contractual assurances and non-interference in internal affairs. The research revealed that certain public statements by officials of Russian diplomatic and consular missions in strategically important regions may contradict Russia’s official stance of non-interference in sovereign nations’ domestic politics. Although this principle is formally proclaimed, frequent comparisons of Russian diplomacy with Western approaches create an impression among host countries that Russia is unwilling to engage with any legitimate government when implementing large infrastructure and energy projects. This complicates the signing of long-term contracts and leads to reduced competitiveness of Russian companies. By contrast, China’s diplomatic practice consistently upholds the principle of non-interference at all levels, allowing Chinese firms to cooperate freely with different political regimes and access strategic assets. In light of these observations, it is advisable for the Russian MFA to ensure uniformity in public statements and actions under the declared non-interference principle, as well as to enshrine corresponding contractual guarantees that promote transparency and predictability of conditions for Russian companies’ participation in long-term international projects.

9. Focusing on bundled deals to promote national companies. Case studies show that one of the most effective tools for promoting national construction companies in international markets is offering comprehensive package deals. In such packages, phases of financing, design, materials supply, local personnel training, and subsequent facility maintenance are combined into a single contract. Diplomatic and consular missions can act as coordinators in concluding such agreements, helping to bundle commercial offers from various Russian entities into an attractive comprehensive package for the client.

10. Diplomatic lobbying in international construction organisations. For the strategic promotion of Russian construction companies on the international stage, active participation of Russia’s consular and diplomatic representatives in the governing bodies of international construction organizations such as FIDIC is recommended. Given that four of the five BRICS founding countries (Brazil, India, China, and South Africa) are already members of FIDIC, Russian diplomatic channels can effectively coordinate positions with BRICS partners to unify tender documentation and simplify access to financing through the NDB. This would allow Russian construction companies to influence international standards and tender conditions, tailoring them to national interests and advancing domestic technologies. Creating Russian working groups and expert committees within FIDIC via diplomatic initiatives would raise the prestige of Russian contractors, protect their interests in the global market, and strengthen Russia’s position as a key player in international infrastructure projects.

In today’s globally integrated economy, the protection of human rights is an increasingly important concern both in the public sphere and in private contractual relationships. International construction contract law (ICCL) is a cross-disciplinary field that seeks to develop effective contractual mechanisms to ensure compliance with key standards – from labor conditions to community interests and environmental protection. A number of studies emphasize that clearly delineating the rights and obligations of all project participants in construction agreements is essential to prevent abuses and strengthen guarantees for workers and affected populations. Combating corruption is highlighted as a central factor in this context: as I. I. Kucherov notes, anti-corruption measures directly impact economic stability, environmental preservation and poverty reduction. Embedding anti-corruption clauses in construction contracts therefore helps prevent violations and expands the protection of labor and social rights. According to L. V. Ulyashina, the effectiveness of international human-rights norms largely depends on their implementation in national legal systems. Consequently, the process of adapting international obligations (such as the UN Guiding Principles) into domestic law is crucial for the actual protection of fundamental labor, environmental and social rights in the construction sector.

The objective of this chapter is to identify and analyze how international human-rights standards are integrated into ICCL and to assess the legal and institutional obstacles that impede their application in transnational construction projects. We examine the relevant international framework (UDHR, ICESCR, the UN Guiding Principles, ILO conventions), review doctrinal approaches and comparative legal studies, analyze selected ICSID cases and international instruments, and highlight the gaps and conflicts that arise. It is hypothesized that systematically embedding universal human-rights provisions – including due diligence and anti-corruption commitments – in construction contracts can enhance legal protection and reduce violations in labor, environmental and social domains. These contractual provisions should be backed by both domestic legislation and States’ obligations under universal and regional human-rights treaties, thereby strengthening law enforcement in large-scale projects.

Key human-rights guarantees are enshrined in universal legal instruments. The Universal Declaration of Human Rights (1948) secures fundamental economic and social rights – for example, the right to work (Art. 23) and the right to an adequate standard of living that ensures health and well-being (Art. 25). These principles were later codified in the International Covenant on Economic, Social and Cultural Rights (1966), which obliges States to ensure fair labor conditions and social welfare. Of particular relevance to the construction industry are ILO Convention No. 155 (1981) on occupational safety and health and the UN Guiding Principles on Business and Human Rights, which articulate corporate accountability for respecting human and labor rights. Collectively, these international legal acts provide a unified framework for regulating large projects and act as tools to safeguard labor, environmental and social norms globally.

At the national level, countries adapt these principles to their legal systems. For instance, the Russian Constitution declares human and civil rights to be of the highest value and establishes that generally recognized principles of international law and international agreements are an integral part of its legal system with priority over domestic law. Such provisions create a legal basis for incorporating international standards – including rights-based obligations – into national regulation. Scholars also note that implementing human-rights and environmental standards in global supply chains significantly increases business transparency.

Despite this normative framework, significant practical and institutional challenges remain. Many national systems lack effective enforcement mechanisms for these norms, especially in cross-border projects. In such cases, international human-rights bodies gain importance. For example, the European Court of Human Rights or the UN Human Rights Committee can intervene when domestic institutions are unable to protect fundamental rights.

Large infrastructure projects often give rise to human-rights concerns in host communities. Forced resettlement without adequate compensation, violations of fundamental labor rights, and environmental harm are frequent sources of disputes. In this context, embedding human-rights due-diligence obligations in contract documentation can significantly reduce the likelihood of legal claims and help ensure respect for core human rights.

International investment disputes illustrate how construction contracts can implicate human rights. In Aguas del Tunari S.A. v. Republic of Bolivia (ICSID Case ARB/02/3), the tribunal examined a water concession contract in Cochabamba. The investor claimed that government actions amounted to an effective expropriation of its investment. The tribunal emphasized Bolivia’s dual duty: ensuring access to water for its citizens while honoring its investment commitments. This case highlights that a lack of explicit contractual safeguards for local communities and clear risk allocation can lead to protracted disputes. It underscores the importance of proactively including social and environmental protections – such as community consultations and environmental impact provisions – in large infrastructure contracts.

In Dirk Herzig (Insolvency Administrator of Unionmatex) v. Turkmenistan (ICSID Case ARB/18/35), a German investor claimed that State interference made it impossible to complete a construction project. The tribunal noted that when an investor enters insolvency and depends on third-party financing, measures like security-for-costs may become necessary to protect both parties’ interests. It also emphasized that contracts should contain clauses aligned with universal human-rights standards (for example, references to the UDHR and the UNGP) and ensure their implementation in practice. This case demonstrates that even procedural issues – such as arbitration financing – can implicate broader human-rights considerations in large projects.

Muhammet Çap & Sehil İnşaat v. Turkmenistan (ICSID Case ARB/12/6) involved multiple construction contracts. The claimant alleged illegal expropriation of assets and denial of due legal process. While the tribunal found that contract terminations and asset seizures were not direct forced expropriations, it highlighted several human-rights–related issues: delays in wage payments, disputes over workforce mobilization, and restrictive measures by authorities, reflecting systemic violations of workers’ rights. Although the claim was framed under investment law, the claimants raised concerns linked to human rights (e.g., timely payment of wages, freedom of movement). This case underscores that potential human-rights infringements (such as failure to pay fair wages) can accompany construction disputes and require detailed contractual safeguards.

In Quiborax S.A. v. Plurinational State of Bolivia (ICSID Case ARB/06/2), the claimants challenged the nationalization of their mining concessions. The tribunal found that Bolivia violated the fair-and-equitable treatment standard by unlawfully expropriating the concessions without adequate compensation. This case demonstrates that the absence of explicit contractual guarantees (such as transparency, non-discrimination and remedy procedures) can lead to serious international conflicts. Even disputes not initially about human rights can implicate fundamental legal guarantees. The Quiborax award confirms that embedding human-rights–related clauses (for example, referencing the ICCPR or the UNGP) in contracts could help prevent such conflicts.

The Salini Costruttori S.p.A. v. Kingdom of Morocco case (ICSID Case ARB/00/4) provided an important precedent. The tribunal held that large construction contracts for socially significant infrastructure projects may qualify as protected investments. This implies that contractors’ rights can be defended under investment treaties, even if the contracting party is a state-owned enterprise. In practical terms, this means that states can be held responsible for violations affecting a foreign contractor, including labor or environmental standards. The Salini ruling thus indicates that state-involved projects must uphold the same human-rights norms (e.g. workplace safety, prohibition of forced labor) as private ones.

In SAUR International S.A. v. Republic of Argentina (ICSID Case ARB/04/4), the dispute concerned a water and sanitation concession. The right to water is recognized as a fundamental human right in multiple international instruments. The tribunal examined to what extent Argentine measures (such as controlled water tariffs during an economic crisis) affected the investor’s property interests and indirectly the population’s access to safe water. The SAUR award highlights that human rights can be protected indirectly in infrastructure projects: by ensuring a stable execution of a water contract, a state upholds the population’s human-rights interests. It shows that when drafting and executing long-term infrastructure contracts, one must consider not only financial terms but also the potential impact on internationally recognized human rights.

These examples underline the need for mutual adaptation of legal systems and the mandatory inclusion of human-rights provisions in construction contracts. Effective regulation should be based on recognized international documents (such as the UNGP) while also accounting for the particularities of domestic systems. Comparative analysis shows that political and cultural factors shape implementation. For instance, Israel explicitly requires businesses to respect international human-rights obligations even in areas of disputed sovereignty. China participates in UN human-rights review processes but tends to implement only select standards, especially regarding civil and political rights. According to Babaei and Torabi, Iran’s legal system integrates international human-rights principles alongside national interests and religious traditions, allowing some flexibility but also creating potential misalignments with universal norms.

Russian scholarship emphasizes philosophical and doctrinal foundations. A. N. Savinkov draws on Fichte’s theory of self-limitation to justify the inclusion of international standards in domestic law. I. V. Lavrenyak examines EPC/M contracts in a comparative context and stresses the need to protect the interests of all parties, including ensuring workers’ rights. Both approaches highlight that legal unification and contract terms must be developed with due consideration of social and labor protections.

In sum, there is a pressing need to strengthen the legal basis for rights protection in ICCL. Harmonizing national laws with contractual and international obligations, complying with UNGP and other treaties, and coordinating global monitoring mechanisms (such as the Universal Periodic Review and UN special procedures) are critical steps. Given divergent interpretations of human-rights norms, contracts should explicitly incorporate international human-rights instruments, and a structured monitoring regime should be established. This legal model accommodates the dynamics of a multipolar world and reconciles the interests of states, companies and local communities.

Experience shows that even in countries with different political and legal systems, universal human-rights standards can be progressively implemented. Anti-corruption rules and supply-chain controls, according to L. Klee, have a positive effect on worker safety and rights compliance in construction projects. Such practices should be scaled up through multilateral cooperation and support from international organizations (e.g. the UN). International arbitration also plays a key role in balancing interests: as M. A. Sapozhnikova and M. R. Khusainova note, arbitral tribunals help mediate between investors and community interests in infrastructure disputes. Ultimately, further development of construction law depends on the ability to identify and correct regulatory gaps in a timely manner. Using unified approaches endorsed by the international community reduces conflict risks and builds trust among market participants.

Economic and political objectives of states must be reconciled with human-rights obligations. Developing a national policy that consistently incorporates international commitments in each new infrastructure project provides a solid foundation for combining commercial success with protection of fundamental rights. From a practical perspective, legal instruments must be constantly updated: a comprehensive approach – covering anti-corruption bans, due diligence and corporate accountability for violations of labor, environmental and social commitments – will ensure robust human-rights protection in the construction sector. The practical importance of this approach is confirmed by analyses of turnkey FIDIC contracts (Silver Book): compensation mechanisms contained there can strengthen protection of the parties’ property interests and rights in international construction projects.

Based on the above analysis, we propose the following practical measures to improve the protection of human rights in international construction contracts:

1. Human-rights impact assessment. Include a clause obligating the contractor to conduct regular human-rights due-diligence audits of the project (in line with the UN Guiding Principles).

2. Linkage to ILO standards. Add explicit references in the contract to ILO Conventions Nos. 155, 29 and 87, establishing strict requirements for labor safety, prohibiting forced labor and ensuring freedom of association.

3. Monitoring and dispute mechanisms. Set up a joint committee (owner, contractor, independent expert) for large projects to monitor compliance with human-rights and anti-corruption measures, with the authority to trigger mandatory mediation or arbitration in case of violations.

4. Liability and penalties. Provide for contractual penalties (e.g. 3% of contract value) for systemic human-rights breaches and require the contractor to remedy any violations under independent audit supervision.

5. International and local norms. Specify that the contractor must comply with both international instruments (including the UN Guiding Principles) and national human-rights laws; any failure to meet these standards should be deemed a material breach of contract.

Including these measures directly in the contract text will significantly enhance the enforcement of human rights in the construction sector, in line with existing ILO and UN standards.

Dual citizenship – holding the nationality of two states – has become increasingly common in the globalized economy, especially among individuals and companies involved in major international construction projects. Such projects often use standardized forms (e.g. FIDIC contracts) with neutral dispute-resolution mechanisms. A party subject to two jurisdictions simultaneously may find that its contractual obligations are interpreted and enforced under both legal systems. It is therefore necessary to consider both public international principles (defining nationality and diplomatic protection) and private international principles (jurisdiction and choice of law). International instruments like the UNCITRAL Model Law on Arbitration, the UNIDROIT Principles of International Commercial Contracts, and Hague Conference conventions, as well as arbitral jurisprudence, offer guidance on nationality issues in cross-border contracts. For example, the UNCITRAL Model Law is designed to cover every stage of the arbitral process and embodies a worldwide consensus on key aspects of arbitration practice.

Under international law, nationality is the legal bond between a person and a state. A dual national has legal nationality in two jurisdictions at once. Traditionally, diplomatic protection is available only if the claimant’s nationality differs from that of the respondent state – a rule often implemented by a “dominant and effective nationality” test. For instance, in the case Pey Casado v. Chile, a dual Spanish-Chilean national was allowed to claim against Chile because his Spanish nationality was deemed dominant. In contrast, the ICSID Convention applies a strict rule: Article 25(2)(a) bars a natural person who is a national of both the host state and another contracting state from ICSID arbitration against the host, unless the host consents to treat that person as if only the other nationality applies. In effect, a person with dual nationality that includes the respondent state loses the right to ICSID arbitration against that state.

Article 25(2)(b) of the ICSID Convention provides an exception for investors who have a “substantial business activity” in the other state of nationality. This allows some dual nationals to claim arbitration access if their primary operations are linked to their non-host nationality. Nevertheless, ICSID requires strict nationality criteria at two points in time (consent and registration). By contrast, the UNCITRAL Arbitration Rules contain no nationality restrictions on the parties. Article 1(1) of the UNCITRAL Rules applies to any arbitration agreement without regard to nationality, and Article 17(1) empowers the tribunal to rule on its own jurisdiction (including objections based on nationality). As a result, UNCITRAL tribunals have discretion to evaluate dual nationality case-by-case, often considering which nationality is dominant.

Several cases illustrate these contrasts. In Pey Casado v. Chile (UNCITRAL), the tribunal held that the claimant’s Spanish nationality was dominant. Conversely, in Saba Fakes v. Turkey (ICSID), a claimant with Turkish–Jordanian citizenship was denied jurisdiction because he could not demonstrate a dominant non-Turkish nationality. These examples show that in investment arbitrations, outcomes can hinge on which rules apply. Tribunals often invoke the principle of effective nationality in UNCITRAL cases, whereas ICSID strictly follows its treaty’s criteria.

In international commercial arbitration (including construction disputes), neutrality is key. Under the UNCITRAL Model Law, for instance, Article 11 states that “No person shall be precluded by reason of his nationality from acting as an arbitrator”, and Article 18 mandates equal treatment of the parties. These norms prevent nationality-based discrimination in the composition and procedure of tribunals. Domestic courts, by contrast, determine jurisdiction based on factors like domicile or presence. For example, Russian law treats a dual national solely as Russian when considering jurisdiction, effectively ignoring the second nationality within Russia.

In private international law of contracts, dual nationality may affect choice-of-law or jurisdiction rules, though modern contracts typically specify governing law and forum to avoid uncertainty. Recognition and enforcement of judgments is also governed by treaties. Notably, the 2019 Hague Judgments Convention establishes that the nationality or character of the parties does not affect its application. Thus a civil or commercial judgment given in one contracting state must be recognized in another regardless of whether a party has dual citizenship.

Dual citizenship therefore poses special risks in international construction contracts. A party may be viewed as domestic in one country and foreign in another, exposing it to disparate regulations (e.g. on licensing, bonding, or currency). It may face tax obligations in both states. Changes in political relations (such as sanctions) may hinder cross-border performance. To mitigate these risks, contracts should include clear choice-of-law and dispute-resolution clauses (often favoring international arbitration). International principles (UNCITRAL, UNIDROIT, Hague instruments) emphasize party autonomy and fairness so that dual nationals can enforce contracts without bias. It is also important to note that BRICS countries vary in approach: China and India do not allow dual nationality; Russia regards its dual nationals solely as Russian; whereas Brazil and South Africa permit full dual nationality. These differences should be taken into account in drafting and performing international construction contracts so that dual citizenship does not become an insurmountable obstacle to fulfilling contractual obligations.

International construction projects require a significant volume of hired labor and thus inevitably generate steady flows of labor migration. The resulting “construction ↔ migration” model creates a complex web of international legal relations in which the host state, the home state, the transnational construction company, and the migrant worker all interact under a multi-level system of norms of public and private international law. Modern scholarship emphasizes that the fragmentation of these norms and the lack of reliable accountability mechanisms contribute to the persistence of the risk of exploitation of migrant construction workers [1]. Studies by F. L. Cooke, who analyzed in detail the staffing practices of Chinese state contractors on overseas projects and showed their impact on international labor standards for migrant workers [2], by A. Halegua, who examined contractor liability for the violation of workers’ rights on projects linked to China’s Belt and Road Initiative and stressed the need for coherence between national and international norms on migrant protection [3], and by J. Wells, who identified a correlation between the “pay-when-paid” clause in standard FIDIC contracts and the vulnerability of migrant workers on Middle East megaprojects, thereby justifying the introduction of joint liability across the entire contracting chain [4], all highlight this problem. In an increasingly multipolar and interdependent world, protecting the rights of migrant workers in the construction industry becomes especially critical. International construction contracts are increasingly bringing in foreign labor, making the regulation of migration a central issue in international law [5]. Establishing unified legal mechanisms and applying international standards are seen as necessary conditions to minimize legal risks and ensure fair working conditions for migrants.

At the same time, a contractual and corporate layer of regulation is developing. The draft UN Business & Human Rights Treaty aims to transform companies’ voluntary social commitments into legally binding standards, which is particularly significant for the construction sector that systematically faces labor rights violations [6]. The post-Soviet region remains one of the largest hubs of labor migration: labor-exporting and labor-importing states there have built their own regimes, often diverging from the universal conventions of the International Labour Organization (ILO). Without reliance on international standards, national practices tend to be either overly repressive or, conversely, insufficiently protective of migrants [7]. Meanwhile, bilateral agreements, being the most flexible instrument, today create the de facto “skeleton” of the system of sources of law in labor migration, fixing the balance of interests of the parties and procedures for mutual recognition of documents — which is critical for construction-investment projects under tight schedules [8]. The institutional inconsistency among soft corporate standards, universal conventions, and bilateral agreements thus leads to legal gaps that heighten the risks of migrant exploitation; conversely, a comprehensive unification of key obligations based on emerging business and human rights treaties, while preserving flexibility at the bilateral level, could fill those gaps and improve legal predictability for all actors.

Multi-level International Norms Protecting Migrant Construction Workers. International protection of migrant workers is shaped by an extensive multi-tiered system of norms. The United Nations Charter of 1945 establishes the general goal of respecting human rights, obligating states to uphold rights and cooperate. Specific standards of equal treatment for migrant workers are set out in ILO Convention No. 97 “Migration for Employment (Revised), 1949” and ILO Convention No. 143 “Migrant Workers (Supplementary Provisions), 1975,” which require non-discrimination in pay, equal access to trade unions, and exchange of migration statistics. As of 6 May 2025, Convention 97 has 54 states parties and Convention 143 has 30. Freedom of movement and equal right to work are proclaimed in the 1948 Universal Declaration of Human Rights, the 1966 ICCPR and ICESCR. These guarantees were expanded by the 1990 UN International Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families, which added obligations on fair remuneration, occupational safety, and family reunification (60 ratifications by May 2025). In Europe, the regional framework is complemented by the 1950 European Convention on Human Rights (ECHR) and the case-law of the European Court of Human Rights. Within the European Union, minimum conditions for posted construction workers are laid down by Directive 96/71/EC on posting of workers, which sets requirements on pay, working time and accommodation; EU member states retain sovereign control over admission of migrants but are simultaneously bound to observe these minimum Union standards, creating a flexible albeit uneven migration law framework in the EU. Notably, since 30 July 2020 (the transposition deadline for recent amendments), the EU has implemented the principle of “same work – same pay” for posted workers and extended guarantees for construction labor (e.g. reimbursement of travel and living expenses, lodging provisions, protection against abusive subcontracting).

Regional trade agreements increasingly serve as “corridors” for lawful labor migration. Chapters on temporary movement of professionals are built into the United States–Mexico–Canada Agreement (USMCA, formerly NAFTA), the Treaty on the Eurasian Economic Union, and the CIS Free Trade Zone Agreement. Multilateral WTO agreements, primarily the General Agreement on Trade in Services (GATS), through “Mode 4” allow companies to send managers and engineers abroad. Soft-law instruments reinforce this system: in 2016 the ILO adopted the Global Principles and Operational Guidelines for Fair Recruitment, along with ILO Recommendations R97 and R151 requiring transparent hiring, a ban on recruitment fees, and protection of vulnerable migrants. Additional standards are promoted by UN bodies — e.g. the International Organization for Migration (IOM) via its World Migration Reports, and the Organization for Security and Co-operation in Europe (OSCE) with its comprehensive “International Framework for the Protection of Migrant Workers” document. Financial institutions like the World Bank include labor and social protections as conditions in financing large construction projects, effectively turning them into oversight mechanisms for labor rights compliance.

Regional and bilateral agreements specific to construction, including arrangements within the Eurasian Economic Union, facilitate migrants’ access to labor markets while simultaneously creating special regulatory regimes that need alignment with commonly accepted international standards. Domestic labor and migration laws, such as Russia’s Federal Law “On the Legal Status of Foreign Nationals,” explicitly reference ratified ILO conventions, and enforcement is divided among courts, migration commissions, and labor inspectorates. Analysis shows that in countries with less developed legal systems, migrant construction workers more often suffer underpayment, lack of union protection, and risk of forced labor, confirming the need to unify norms at the international level [9]. The scale of the problem is significant: the IOM’s Migration Data Portal records roughly 280.6 million international migrants, and the Global Migration Indicators 2024 report indicates that this number is rising due to economic crises, conflicts, and climate change. According to the ILO, women are slowly increasing their presence in migration flows, but the majority of those employed in construction remain low- and semi-skilled workers in the informal sector, where they are especially prone to labor and social rights violations. It is the ILO and UN conventions, decisions of European courts, and provisions of trade agreements that together form the necessary “legal framework,” while international organizations act both as lawmakers and monitoring mechanisms, ensuring protection of migrants and stability of construction projects.

Case Law: Balancing Migrant Rights and Economic Freedoms. Precedents from international human rights and economic courts vividly illustrate the tension between protecting migrant workers and upholding market freedoms. The European Court of Human Rights (ECtHR) in Chowdury and Others v. Greece (No. 21884/15, judgment of 30 March 2017) dealt with a complaint by 42 Bangladeshi nationals — irregular migrants hired in 2012–2013 to work on a strawberry farm in Greece without work or residence permits. They were promised €22 per day, but wages were systematically withheld, living conditions were abysmal, and their labor was overseen by armed guards. After the workers began demanding their pay, one of the guards opened fire on them, wounding several individuals. In 2014, a Greek court convicted those responsible only for grievous bodily harm and acquitted on human trafficking charges, reasoning that the migrants had ostensibly consented to work and were not confined in their movement. The ECtHR found Greece in violation of Article 4 of the ECHR, citing also the Council of Europe’s Anti-Trafficking Convention and the UN Palermo Protocol. The Court stated that a worker’s consent does not exclude forced labor if exploitation of vulnerability occurs, and further noted that a state must not only refrain from allowing exploitation but also effectively prevent it by private actors. As a result, the Court held Greece responsible for failing to prevent and prosecute trafficking, and for not providing adequate compensation: it awarded €16,000 to each applicant who had participated in the domestic proceedings and €12,000 to each of the others. Greece had not fulfilled its obligations to prevent, investigate and punish trafficking, nor to secure appropriate redress. This decision has direct relevance for international construction contract law, since similar forms of exploitation can arise on construction projects involving migrant labor, and in such cases the state bears international responsibility for inaction.

The Court of Justice of the European Union (CJEU) has likewise contributed to delineating the boundaries of worker protection versus economic freedoms. In Laval un Partneri Ltd v. Svenska Byggnadsarbetareförbundet (Case C 341/05, 2007), a Latvian construction company posted workers to Sweden but refused to sign the local collective agreement that provided for higher pay than Latvian law. In response, a Swedish trade union organized a collective action (a blockade of the site), stopping work and forcing the company to cease operations. Laval sued, and ultimately the CJEU ruled in its favor, holding that the freedom to provide services under Article 49 TFEU takes precedence over union actions that impose requirements beyond the officially established minimum standards available to a foreign contractor (the “nucleus of mandatory rules” under Directive 96/71/EC on posted workers). The union’s action was deemed to infringe EU law: Laval won the case, wages were not raised, and the precedent limited excessive pressure on foreign contractors in construction.

A similar balance was at issue in International Transport Workers’ Federation & Finnish Seamen’s Union v. Viking Line ABP (Case C 438/05, 2007). Finnish ferry operator Viking Line ABP planned to “reflag” a vessel to Estonia and hire cheaper labor, to save costs. Unions sought to prevent wage undercutting by threatening strike action to force the employer to uphold the Finnish collective agreement. Viking sued in the UK, and the case went to the CJEU. The court affirmed the right to strike as fundamental, but found it cannot be used in a disproportionate manner that essentially blocks the freedom of establishment (Article 43 EC Treaty). The union pressure that would render reflagging economically pointless was viewed as a restriction on that freedom and permissible only if it was proven necessary to protect workers and if the least burdensome measures were used. Thus, legally Viking “prevailed,” since it was allowed to invoke Article 43 directly against the unions, the strike was deemed potentially unlawful, and no wage increases were achieved. The key takeaway for international construction (and similar) contracts involving migrants is that while unions may act to protect wage levels, their actions must be strictly proportionate and based on transparent legal standards, otherwise they violate internal market freedoms.

In Commission v. Luxembourg (Case C 319/06, 2008), the European Commission challenged Luxembourg for imposing overly strict requirements on foreign construction companies posting workers from other EU states. Luxembourg required each such company to have a designated representative residing in the country to keep all employment documents on site, and it tried to enforce additional labor rules under the guise of “public order” without sufficient justification. The CJEU found these requirements illegal and contrary to the freedom to provide services. Luxembourg lost and had to repeal the measures. For international construction contract practice, this case signaled that under FIDIC contracts in the EU context, one cannot include excessive or unreasonable administrative constraints (like mandating a local agent or on-site document storage) unless justified by specific labor risks. The decision helped simplify operations for construction companies and facilitated the posting of workers without compromising their rights.

In Dirk Rüffert v. Land Niedersachsen (Case C 346/06, judgment of 3 April 2008), a insolvency administrator of Objekt und Bauregie GmbH & Co. KG contested the termination of a public works contract and a penalty imposed by the German state of Lower Saxony. A Polish subcontractor on the project had paid posted workers only about 46% of the wage set by a regional collective agreement for construction. The Land’s procurement law required contractors to guarantee wages at least at the level of that agreement. The CJEU held that this requirement violated the freedom to provide services (Article 49 TFEU) and the Posted Workers Directive 96/71/EC, since the collective agreement in question was not declared universally binding. The directive allows mandatory compliance with labor conditions (including minimum pay) only if they are laid down by law or universally applicable collective agreements. Since that was not the case, the additional wage requirement constituted an unjustified obstacle to free movement of services and was deemed impermissible. Lower Saxony lost the case, and the requirement to pay the local rate was annulled, meaning wages remained as set by the Polish subcontractor and the workers did not receive any increase. This precedent limited the ability to insert “social clauses” into international construction contracts in the EU unless backed by universally applicable law.

Investor–state arbitration further complements this picture by assessing state migration measures through the lens of investment obligations. In Biwater Gauff (Tanzania) Ltd. v. Tanzania (ICSID Case No. ARB/05/22, 2008), a British investor in a water services concession in Dar es Salaam sued Tanzania over the forcible deportation of foreign managers, unilateral termination of the concession contract, seizure of assets, and transfer of operations to a state entity (DAWASCO). The investor claimed breaches of the UK–Tanzania bilateral investment treaty (BIT), including unlawful expropriation, failure to accord fair and equitable treatment, and failure to provide full protection and security. The tribunal found that deporting foreign experts without due process, combined with seizure of infrastructure and contract termination, amounted to a composite breach of investment obligations. Although no damages were awarded (since the project had no economic value at the time of state interference), the arbitrators underscored that migration measures affecting key technical personnel involved in international construction contracts can give rise to state responsibility if they impede the realization of an investment project. The Biwater Gauff case illustrates that in the realm of international construction contract law, effective legal regulation of labor migration matters not only domestically but also as a condition for states’ compliance with investment protection obligations, especially when migration-related measures impact the performance of infrastructure projects and the operations of foreign contractors.

In Caratube International Oil Company LLP v. Republic of Kazakhstan (I) (ICSID Case No. ARB/08/12, award of 2014), the claimant — a Kazakh-registered company allegedly controlled by a U.S. citizen (D. Khourani) — argued that Kazakhstan’s extensive inspections by state authorities in an oil field development and pipeline construction project violated the U.S.–Kazakhstan BIT by hindering project implementation, including the hiring of foreign labor and the issuance of visas and work permits. The ICSID tribunal dismissed the claim, holding that the claimant had failed to prove “foreign control” under Article 25(2)(b) of the ICSID Convention, and that the state’s actions enforcing migration and labor laws fell within its legitimate regulatory powers (an exercise of “police powers”) and did not breach international obligations. The inspections were lawful, non-expropriatory, and constituted the state’s enforcement of domestic laws; no compensation was due, and the claimant was ordered to pay Kazakhstan $3.2 million in costs. The workers themselves were not parties to the case and no claims about their wages or conditions were adjudicated. This case shows that international arbitration does not treat the protection of migrants’ rights as an end in itself, but evaluates state conduct based on investment commitments. A state’s enforcement of visa, permit and labor requirements is a sovereign prerogative that does not violate international law if done in good faith and without discrimination. Consequently, construction companies must ensure strict legal compliance with migration and labor rules in advance, or else face administrative consequences and the potential loss of international legal protection.

In Muhammet Çap & Sehil İnşaat Endüstri ve Ticaret Ltd. Şti. v. Turkmenistan (ICSID Case No. ARB/12/6, decision 2021), Turkish investors claimed Turkmenistan breached the Turkey–Turkmenistan BIT by obstructing construction projects in the Avaza tourist zone through systematically refusing visas and barring foreign labor. In their view, this violated their right to engage qualified migrant workers and undermined the performance of construction contracts; they argued they applied for visas, but Turkmen authorities imposed excessive bureaucratic barriers (especially for entry into the Dashoguz region). However, the tribunal did not reach the merits, finding it lacked jurisdiction because the investors had failed to comply with a procedural precondition in the BIT: Article VII(2) required submitting the dispute first to Turkmen courts for a year, and only if no decision was obtained could ICSID arbitration be pursued. The investors had gone straight to ICSID without litigating in Turkmenistan, so the tribunal deemed its jurisdiction “unconfirmed” and dismissed the case without awarding compensation. The decision relied on international investment law norms (notably the ICSID Convention 1965 and the Vienna Convention on the Law of Treaties 1969) since it concerned a BIT, and ultimately neither the workers nor the investors obtained any remedy or acknowledgment of their claims — the case was primarily about protecting investors’ rights, not the migrants themselves. This outcome underscores that state migration control measures, even if they de facto hinder project implementation and foreign labor inflows, can be upheld as lawful in arbitration when formal treaty procedures are not followed. The failure to meet such procedural conditions precludes consideration of the substance and limits both investors’ and associated migrant workers’ ability to protect their interests.

Contractual Mechanisms and Corporate Standards. International construction contracts (for example, FIDIC standard forms) are private agreements among project participants. Despite their private nature, these contracts intersect with public international law wherever employment and migration issues are concerned: requirements for work visas, engagement of local personnel, social security obligations, etc. Most FIDIC standard contracts include choice-of-law clauses and require compliance with national laws. They typically obligate the contractor to observe “all applicable laws, including labor laws” in executing the work. In practice, this means the contractor must obtain work permits for foreign specialists or hire the required number of local workers in accordance with host country regulations. A recent FIDIC guidance noted that “forced labor is prohibited in most countries,” and that the client’s task is to ensure contracts allow the implementation of measures against the use of illegal labor. Such provisions echo the international principle of preventing labor exploitation: by including these contractual rules, attempts to circumvent national requirements or to employ migrants unlawfully are thwarted.

Sometimes contracts explicitly stipulate quotas for hiring local workers or obligations to train the local workforce. These terms aim at development goals and protecting the local labor market, but they must be reconciled with international obligations. For example, if the host state has ratified ILO equality conventions, such quotas should not formally discriminate against foreign workers in the protection of their rights (equal pay, social benefits, etc.). Otherwise, a contractor might question the host state’s good faith and seek international arbitration (e.g. ICSID). International law recognizes that enforcing domestic immigration rules and quota conditions falls under a state’s sovereign right, but that the host state must still respect its commitments under ratified conventions.

The role of international financial institutions must also be noted. Development banks (the BRICS New Development Bank, World Bank, EBRD, etc.) that finance large construction projects impose conditions in loan agreements and social and environmental standards that address workers’ rights. They require governments and contractors to abide not only by domestic laws but also by international standards (for example, to avoid forced labor, comply with minimum wage requirements, observe occupational safety norms, etc.). Although these stipulations formally belong to the financing contract, they strengthen the international legal basis of labor migration governance: actual project contracts effectively incorporate references to international norms.

Alongside state and intergovernmental forums, quasi-judicial grievance mechanisms established by multilateral development banks and transnational corporations play a significant role in protecting labor standards. The World Bank’s independent ombudsman (Compliance Advisor Ombudsman, CAO) reviews complaints from workers on World Bank–financed enterprises, including construction projects employing migrants. Despite its unofficial status, CAO decisions prompt borrowers to remedy violations, thereby complementing international oversight mechanisms for labor conditions.

Finally, the construction sector attracts the attention of transnational corporate human rights initiatives (e.g. the UN Guiding Principles on Business and Human Rights, the UN Global Compact). These soft-law instruments encourage companies involved in international projects to guarantee workers’ rights, including those of migrants. For instance, companies are expected to avoid employing undocumented migrants and to protect them from abuses by subcontractors. While these norms are not legally binding, they create a corporate responsibility environment in construction and are taken into account in project financing and insurance.

Global Trends and Humanitarian Aspects of Migration. The study revealed that international construction contract law faces serious challenges in ensuring legal protection of migrant workers and in fulfilling international obligations. Vincent Chetail [5,9] and T. Alexander Aleinikoff [9] emphasize the need to develop international legal norms aimed at protecting migrants’ rights and creating conditions for their legal and secure employment. International projects increasingly require labor from abroad, heightening the importance of international standards and legal mechanisms in this field. Poverty stands out as one of the main factors driving migration flows and generating new challenges for the international community. Economic instability leads to deteriorating living conditions, rising unemployment, and a lower level of migrant rights protection. Migrant poverty often causes vulnerability and exploitation in the workplace, which calls for comprehensive legal measures to safeguard their interests.

The international community is actively working towards the UN Sustainable Development Goals [18], which aim to eradicate poverty and improve living conditions. This is directly related to labor migration in construction, where migrants often occupy low-paid and unsafe jobs. Alleviating poverty and ensuring decent working conditions are fundamental to developing legal mechanisms for protecting migrants and integrating them into host economies.

An analysis of the 2015 migration crisis in Europe — when more than a million migrants arrived — showed that this mass influx became a serious challenge for the international community. The crisis exposed the inability of existing international mechanisms to effectively manage migration flows and highlighted political and social divisions among European states. The issue of fair burden-sharing of migrants within the EU underscored the need to reform international legal norms with an emphasis on enhanced coordination and more equitable distribution of responsibility for refugees [19]. Debates over the humanitarian aspects of migration intensified in 2019, when the UN High Commissioner for Refugees appealed to European governments to allow the disembarkation of over 500 rescued migrants adrift in the Mediterranean Sea. The plight of those migrants, stranded at sea without a port of safety, underscored disagreements among EU countries on migration policy. This demonstrated the need to rethink existing approaches to migration in order to create a more equitable and humane regulatory system. As E. V. Eremyan notes, immigration has a substantial impact on the political stability of the European Union, causing a crisis of liberal democracy due to the mass influx of refugees [20]. States’ failure to integrate immigrants leads to the degradation of democratic institutions and heightened social tension.

A key element in migration management is the institution of readmission, which enables states to combat illegal migration effectively by returning persons with irregular status to their countries of citizenship or permanent residence. As A. Yu. Yastrebova observes [21], the successful implementation of readmission agreements requires inter-state cooperation based on mutual obligations to identify individuals, determine the nationality of irregular migrants, and take back one’s own nationals. In the construction sector, utilizing readmission mechanisms promotes the legality of migration processes and enhances national and public security.

International Coordination and National Adaptation. Since the mid-20th century, the United Nations has played a leading role in coordinating international efforts on migration governance. The adoption of the New York Declaration for Refugees and Migrants in 2016 and the Global Compact for Safe, Orderly and Regular Migration in 2018 were key steps in developing international migration law. These documents laid the groundwork for coordinated international efforts and underscored the importance of protecting migrants’ rights, which is especially relevant for the construction industry. The IOM plays a significant role in developing effective mechanisms for managing migration, operating on the principle that orderly and humane migration benefits both migrants and receiving states, contributing to socio-economic development.

Migration data plays a crucial role in the global information space, and amid intense information conflicts surrounding population movements, it is particularly important to foster a favorable legal and social environment for migrants. The UN–IOM “I am a migrant” platform, which shares real-life stories of people involved in migration, helps raise public awareness of migrant construction workers’ contributions to host countries’ economies and at the same time strengthens tolerance towards law-abiding migrant workers who often face discrimination in the construction sector.

Notably, in the context of an emerging multipolar world and a shortage of skilled personnel in construction, international regulation of migration flows becomes even more significant for securing workforce needs. As Russian Deputy Prime Minister M. Sh. Khusnullin stated, attracting labor from abroad demands effective legal regulation of migration and protection of migrants’ rights [22]. Integrating international standards into national legal systems is a key factor in creating safe conditions for migrant workers and reducing social tensions in host countries. Using the European Union’s experience in regulating labor migration can serve as a model for unifying legal norms and standards of labor rights protection. However, the EU experience is not entirely positive, as an unprecedented rise in migration has already led to street unrest in France and the UK, and rising crime in Germany. Adapting national legal systems should be based on recommendations of international organizations such as the UN and ILO. Implementing such norms would integrate best practices of migrant rights protection into national legislation. For example, in Russia, legislative initiatives developed in September 2024 aimed at regulating labor migration and tightening control over illegal residence [23]. At the same time, a decline in Russia’s attractiveness for migrants due to the periodic collapse of the ruble (over 100 rubles per USD), political tensions, and increased migration controls coincides with a growing need for human resources, especially for rebuilding industrial and residential facilities in new territories. This makes the problem particularly acute and in need of solutions.

International cooperation and legal support for migrants should become a strategic direction of development. Strengthening collaboration between migrant-sending and migrant-receiving countries entails not only legal protection but also creating conditions for migrants’ integration into host economies. This is especially relevant for the construction industry, where migrants play a key role in delivering international projects. Russia, as a UN member, should take international norms into account in its migration governance while devising its own approach that avoids the mistakes of Europe.

The effectiveness of global standards depends on their implementation at the national level. Most states enshrine in their migration and labor laws special statuses for work visas, wage guarantees, and minimum social rights. However, certain domestic requirements — for example, mandatory registration or limited housing access for migrants — sometimes conflict with the non-discrimination principles of ILO Convention 97. In such cases, national courts increasingly turn to the norms and spirit of international conventions as an interpretative tool, aided by emerging case-law in Southeast Asia and the CIS.

Judicial and arbitral practice confirms the applicability of universal human rights principles and the freedom to provide cross-border services to construction labor migration. The ECtHR in Chowdury v. Greece established state liability for forced labor, whereas the CJEU in Laval underlined the need to balance protecting workers with employers’ economic freedoms. Outside Europe, international arbitrators generally affirm the primacy of states’ sovereign rights if their measures do not contravene ratified inte

In the emerging multipolar global order, international construction projects face new legal challenges concerning the protection of workers’ rights and the provision of social security. Divergent national labour laws and social welfare systems complicate transnational projects, highlighting the need for harmonized international standards. International labour law thus becomes a key mechanism for aligning approaches to protect workers globally.

International Labour and Social Security Standards. The core of the international social protection framework is established by conventions of the International Labour Organization (ILO). ILO Convention No. 102 on Social Security sets basic minimum standards on pensions, unemployment benefits, health care, and other social security measures to ensure a decent standard of living. The European Social Charter further obliges member states to guarantee wages sufficient to cover a decent living. Shaykhutdinova notes that under this Charter, a minimum wage should be set at 60–68 % of the national average salary, along with support measures for workers with insufficient income (Shaykhutdinova, 2012). Overall, these international norms seek to provide a unified floor of protection across jurisdictions.

National Approaches and Conflicts. Every country has its own labour and social security model, affecting how international contracts operate. For example, in Russia there is debate about minimum wage calculation: Davletgildeev and Zarubin observe that computing the minimum wage based on the national average rather than the median salary better fulfills international obligations and enhances worker protection (Davletgildeev & Zarubin, 2023). They argue that this would particularly benefit workers on international projects who currently risk low pay. Reforms in other jurisdictions show similar tensions: in 2022, the United Arab Emirates adopted Federal Decree-Law No. 33/2021 to modernize private sector labour law and improve conditions in sectors like construction. However, the International Trade Union Confederation reports ongoing issues such as mass deportations of migrant workers without legal aid, delayed wages, and restricted labour organizing. These examples illustrate a gap between national changes and ILO standards, underscoring the need for greater international alignment.

Concept of International Labour Law and Methodology. Despite its growing significance, “international labour law” lacks a single definition and varies by legal tradition. Scholars like Bugrov and Tuaev emphasize that this diversity reflects the field’s complexity and calls for developing common principles that accommodate different national contexts (Bugrov, 2007; Tuaev, 2016). International labour law can be viewed both as an academic discipline and a practical field of law: Kiselev treats it as a subject helping to understand how national labour laws interact with international standards, thus forming an effective mechanism for worker protection in a multipolar world (Kiselev, 1999). In construction, where projects cross jurisdictions, such integration is critical. Tomashevsky notes that international labour law encompasses both international agreements and the conflict of laws issues arising in transnational employment relationships (Tomashevsky, 2010). In this sense, international labour law intersects with international public law: it includes norms regulating the protection of workers’ rights and establishing minimum labour standards in areas like social security and occupational safety.

Labour Rights, Non-Discrimination, and Social Protection. Non-discrimination is a core principle of ILO standards. Convention No. 111 explicitly prohibits distinctions in employment or occupation based on race, sex, religion, or other status. In multinational construction projects, it is crucial to ensure equal conditions for migrant workers, women, persons with disabilities, and other vulnerable groups. Scholars such as Agatov and Alyoshina & Kosovskaya emphasize that legal mechanisms to prevent labour discrimination are integral to international labour law and are essential for protecting workers’ rights (Agatov, 2023; Alyoshina & Kosovskaya, 2014). For example, studies highlight that migrant construction workers often face informal work arrangements, complex subcontractor chains, wage theft, and ties to employers through housing or visa status. This underscores the need for multinational efforts to protect migrants, including multilateral agreements, greater transparency in recruitment, expanded collective bargaining rights for migrants, and stricter enforcement of labor standards at local levels. Thus, international norms on non-discrimination and social security serve as a foundation for fair working conditions globally.

Contractual Standards and the Role of FIDIC. The International Federation of Consulting Engineers (FIDIC) develops model contract conditions for construction projects that include social provisions. FIDIC clauses expressly allow parties to revise contract terms when legal or external conditions change (force majeure). This flexibility enables adapting agreements to evolving legal environments and mitigating risks for workers. Specifically, allowing contractual amendments in response to regulatory changes or unforeseen events provides protection in crises (such as economic shocks or pandemics). Emphasizing such flexibility highlights the importance of international social standards: FIDIC’s approach helps align labour protections across jurisdictions in multinational projects.

Challenges and Future Directions. The analysis shows that ILO conventions and FIDIC standards help harmonize labour conditions, but do not resolve all conflicts. Universal frameworks struggle with the cultural and legal diversity of countries. Attempts to impose one-size-fits-all solutions have met with mixed results. Hence, more adaptable approaches are needed. Experts suggest revisiting certain ILO conventions – for example, reconsidering language in the anti-discrimination convention to account for national traditions – to improve acceptance and effectiveness. Acknowledging that one global system cannot ignore local differences, the key task of international labour law is to develop flexible legal mechanisms that protect workers while respecting each country’s context. Only by recognizing legal and cultural diversity, and building adaptive norms, can the law achieve true harmonization of labour rights and strengthen workers’ social protection in international construction projects.

Dispute settlement in construction contracts relating to infrastructure projects in polar regions has become increasingly salient in light of international-law challenges that concern not only territorial matters but also labour relations and social security for workers employed under extreme conditions. Polar regions such as the Arctic and the Antarctic encompass vast areas whose legal status is shaped by a combination of treaty law, custom, and decisions of international bodies. The heterogeneity of legal regimes requires attention to both State territories and international spaces governed by special regimes. In a harsh climate, occupational safety, social insurance, and preventive security measures acquire central importance, which presupposes coordination among States, organisations, and private actors within the framework of International Construction Contract Law (ICCL).

The paucity of specialised multilateral instruments providing comprehensive protection for workers in extreme polar environments enhances the importance of ICCL’s contractual and procedural devices. Over recent decades, increased economic activity related to resource development and transport infrastructure has revealed the need for flexible yet legally robust mechanisms for dispute resolution and risk allocation capable of accommodating the territorial, environmental, and social particularities of the Arctic and the Antarctic. Polar law has crystallised as an autonomous discipline analysing the interaction of global, regional, and national regimes, with a particular emphasis on the rights of indigenous peoples and on the growing role of private law in regulating complex project relationships (Tanaka, Johnstone, & Ulfbeck, 2023).

Attention to the polar regions is growing not only among Arctic coastal States but also among non-Arctic countries. By adopting its Arctic Policy in March 2022, India strengthened its institutionalised presence in Arctic discourse through participation in international fora and scientific programmes, aligning research and infrastructure initiatives with foreign-policy and economic interests. Scholarly analysis distinguishes discursive, structural, institutional, and moral dimensions through which international discourse shapes India’s Arctic agenda: diplomatic statements and participation in the Arctic Council; enhancement of domestic research and icebreaking capabilities; engagement in organisations and norm-formation; and an ethical platform focused on the rights of indigenous peoples and environmental protection (Hua, 2023). Given its large population and cost-competitive labour force, India is objectively oriented towards participation in Northern infrastructure projects, which requires particular attention to the procedural safeguards of construction contracts and to dispute-resolution regimes.

The legal framework of the polar regions rests on a combination of treaty law, custom, and general principles. The United Nations Convention on the Law of the Sea (UNCLOS) provides the key algorithms for delimiting the continental shelf and exclusive economic zones and offers international mechanisms for resolving maritime disputes, including a specialised tribunal and arbitral procedures that ensure peaceful settlement and predictability in the legal status of maritime spaces (Churchill, Lowe, & Sander, 2022). For Arctic infrastructure projects this implies the need to coordinate the law-of-the-sea regimes with environmental requirements and with the contractual obligations of construction participants.

Within the United Nations legal order, the principles of territorial integrity, sovereign equality, and the peaceful settlement of disputes have fundamental significance. They are entrenched in the Declaration on Principles of International Law concerning Friendly Relations and Co-operation among States, which underscores the inadmissibility of the threat or use of force and the duty to respect the political independence and territorial integrity of States. These principles function not only as external limits on permissible conduct but also as a legality framework for project decisions in polar regions, where the intersection of several States’ interests is frequently accompanied by disputes over delimitation or jurisdiction (Starushenko, 1978).

India’s participation in Arctic discourse is complemented by practical initiatives in energy and shipping, including dialogue with coastal States and the development of icebreaking capacity, as reflected in studies emphasising the political-legal and economic rationales of this course (Kumari, 2015; Jawahar, 2020). At the same time, sanctions-related constraints on certain Arctic ventures demonstrate the sensitivity of cross-border infrastructure to geoeconomic risks and indicate a need for ICCL’s contractual stabilisation instruments that account for secondary sanctions, force majeure, and changes in economic conditions.

ICCL performs four functional roles: risk allocation, dispute resolution, legal coordination, and change management. First, the risk matrix in polar projects requires precise allocation—between employer and contractor—of temperature-related risks, ice conditions, logistical isolation, environmental constraints, and labour guarantees, with due regard to insurance clauses and liability for delay. Second, the dispute-resolution mechanism should combine multi-tier procedures with expedition: pre-dispute negotiation, expert determination, and arbitral proceedings calibrated to the specificities of the North. Third, legal coordination presupposes harmonisation—through a single contract-administration spine—of requirements drawn from the law of the sea, environmental law, labour law, and investment law. Fourth, change management entails predictable models of variations, compensation events, and time adjustments driven by seasonal access, weather windows, and supply limitations (Tanaka, Johnstone, & Ulfbeck, 2023; Patricia et al., 2009).

By structuring the delimitation of the continental shelf and the EEZ, UNCLOS also affects the siting of infrastructure facilities, the parameters of maritime logistics chains, and environmental-impact assessment—including for extraction and liquefaction installations. The expanding portfolio of Arctic projects illustrates the complexity of contractual solutions in which environmental protection and the law-of-the-sea status are tightly interwoven (Churchill, Lowe, & Sander, 2022). For the Russian Federation and its partners, issues relating to the status of the Northern Sea Route and the coordination of project activity with international obligations on marine-environment protection are of particular relevance.

Labour-rights guarantees and social security protections for workers remain central. Under conditions of low temperatures, polar night, transport fragmentation, and limited access to medical care, the contract must stipulate heightened standards of occupational safety, medical insurance, compensation, and rotational work schedules, as well as special regulations for temporary settlements and shift camps. These elements are a matter of contractual particularisation and, simultaneously, of transboundary social regulation, aligning with the general trend towards strengthening the social component of international economic projects (Rajan, 2017).

In the context of world politics, structural realism stresses that the international system remains anarchic; States provide for their own security and protect their territories largely through their own efforts, especially in regions of competition for resources and transport corridors. This calls for project decisions proportionate to geopolitical constraints and reinforces the case for predictable, legally resilient ICCL procedures to neutralise political risks (Waltz, 2000).

Given the involvement of non-Arctic States in Arctic governance, it is advisable to clarify the institutional parameters of observer participation and the subject-matter remit of consultative platforms. Conceptually, it is appropriate to emphasise the priority of coastal States’ sovereign rights while maintaining openness to scientific and technological cooperation; at the same time, the regulation of external actors’ participation may be linked to their recognition of national jurisdictions over economic activity on Arctic territories.

For project governance, it is useful to typologise five patterns of disputes involving non-Arctic States: commercial disagreements between investor and State, including sanctions risks and share reallocation; disputes over the regime of transport corridors and the application of the law of the sea; conflicts concerning access to research infrastructure; claims related to the construction of ports, roads, and other Arctic infrastructure; and disputes arising from mineral extraction and the protection of indigenous peoples’ rights. These patterns indicate the need for a modular ICCL architecture combining arbitration clauses, multi-level expert evidence, and adaptive stabilisation provisions.

The cumulative result indicates the necessity of strengthening international cooperation and developing specialised regulations for polar projects that encompass environmental protection, the rights of indigenous peoples, and enhanced labour guarantees. Prioritising ICCL’s contractual mechanisms—underpinned by the law of the sea, environmental norms, and social standards—reduces transaction costs and increases project resilience in a complex politico-legal environment (Patricia et al., 2009; Churchill, Lowe, & Sander, 2022; Tanaka, Johnstone, & Ulfbeck, 2023).

The international legal regime of maritime zones is primarily defined by the 1982 UN Convention on the Law of the Sea (UNCLOS). UNCLOS establishes successive zones – internal waters, territorial sea (12 nm), contiguous zone, Exclusive Economic Zone (EEZ, up to 200 nm) and continental shelf – each with specific rights. A coastal State exercises sovereignty in its territorial sea, and sovereign or exclusive rights in its EEZ and continental shelf to explore and exploit natural resources (both living – e.g. fisheries – and non-living – oil, gas, minerals). For instance, NOAA notes that within an EEZ a coastal State has “sovereign rights for the purpose of exploring, exploiting, conserving and managing natural resources, whether living or non-living, of the seabed and subsoil and the superjacent waters”. UNCLOS grants coastal States exclusive jurisdiction over the construction and operation of artificial islands, installations and structures in their EEZs (Art. 60). Artificial islands have no territorial sea of their own and remain under the authority of the coastal State. All States are entitled to lay submarine cables and pipelines on the continental shelf in accordance with Art. 80 UNCLOS, subject to advance notice and the coastal State’s right to take measures concerning its resources. Coastal States may also grant rights to renewable energy projects (offshore wind, tidal, wave installations) in the EEZ, as UNECLOS explicitly includes “production of energy from water, currents and winds” in EEZ economic activities. Passage regimes (innocent passage in territorial waters; transit or archipelagic sea lanes passage in straits and archipelagic waters) ensure navigation while respecting coastal State rights. Various countries have incorporated UNCLOS into national law (e.g. U.S. Magnuson-Stevens Act, EU Maritime Policy, Russian Water Code, etc.), establishing licensing and environmental requirements for offshore construction.

In the context of international construction contracts, standard form agreements by the International Federation of Consulting Engineers (FIDIC) play a central role. For example, FIDIC’s “Blue Book” (Form of Contract for Dredging and Reclamation Works, 1st ed. 2006) provides model terms for routine dredging projects. More complex offshore constructions – such as deepwater oil & gas platforms, cross-sea pipelines, and large-scale reclamations – often require tailored contract provisions or other FIDIC forms (Red, Yellow, etc.). Contract clauses typically address site investigation (marine surveys, geotechnical reports), importation of construction materials, insurance and liability for oil/gas leaks, and compliance with environmental regulations (marine habitat protection, pollution prevention). When constructing offshore wind farms or tidal energy devices, contracts also cover grid interconnection, redundancy of subsea cables, and weather delays. International norms (e.g. Basel Convention, London Protocol, IMO guidelines) may be referenced for marine environmental protection. National laws (for example, coastal zone management and maritime safety laws) are explicitly incorporated by reference. FIDIC contracts often include arbitration clauses (ICC, LCIA, UNCITRAL, etc.) and governing law clauses that specify the application of UNCLOS principles and the domestic law of one party or a neutral jurisdiction.

International arbitration has been the principal forum for resolving disputes in large-scale maritime infrastructure contracts. Arbitral tribunals draw upon UNCLOS and applicable national laws in interpreting parties’ rights. A notable example is the COMMISA v. Pemex (ICC) arbitration, concerning a contract for offshore oil platforms. The tribunal awarded compensation to the contractor (Mexican COMMISA) for wrongful termination by Pemex, but Mexican courts later annulled the award as involving an act of public authority. (U.S. courts, conversely, enforced the award.) This case illustrates the tension between state sovereignty and private contract rights in maritime projects. Other ICC cases (e.g. Jan de Nul v. Arab Republic of Egypt; Salini v. Morocco) similarly highlight how economic, administrative and political pressures – sanctions, permit delays, unilateral contractual changes – can upset agreed risk allocations. In practice, arbitration panels often refer to FIDIC’s dispute resolution mechanisms (Dispute Adjudication Boards, international arbitration) and to UNCLOS-derived duties (e.g. environmental protection obligations) when deciding such cases. Bilateral investment treaties and free trade agreements also influence these arbitrations, since contractors may invoke investor-protection provisions if state interference is alleged. National courts may be asked to enforce or annul awards; UNCLOS itself provides no remedy, but Article 94 (duty to comply with awards) reinforces international enforceability.

Cross-border marine infrastructure projects underscore the interdependence of states and international contract law. Major offshore pipelines (e.g. the Nord Stream gas pipelines in the Baltic Sea) traverse multiple zones and have been governed by intergovernmental agreements on rights-of-way, reflecting the rule of UNCLOS Art. 80 on pipelines. Offshore ports and artificial islands (e.g. for drilling platforms) are similarly governed by national jurisdiction under UNCLOS and by contract terms. On renewable energy, joint ventures in offshore wind (North Sea, Atlantic) rely on harmonized technical standards and coordinated permitting. In all cases, international construction contracts must integrate UNCLOS norms – for example, by stipulating compliance with marine environment conventions – and FIDIC standard clauses. This ensures legal certainty and dispute avoidance. As UNCLOS provides the overarching regime for marine spaces, its combination with FIDIC standards and national laws creates a comprehensive framework for sustainable development and dispute resolution in international marine construction.

The age of passenger drones is upon us, demanding a new approach to airspace safety. Collisions between aircraft and ground structures are not rare. For example, in Russia 66 aviation incidents caused by power-line collisions were recorded from 1991 to 2013. Many such incidents have been deadly: a 2011 Tu-134 crash into a transmission line killed 44 people. These cases illustrate the need to re-examine current rules and proactively devise safety measures.

International air law – based on the Chicago Convention (1944) and the Montreal Convention (1999), together with ICAO standards and recommended practices – provides the main regulatory framework for flight safety. At the same time, international construction law and especially international construction contract law (as embodied in FIDIC standard contracts) has grown important for cross-border projects. However, these two bodies of law have largely evolved separately, creating a gap at their interface. The proliferation of high-rise construction and ‘aerotropolis’ urban models intensifies this gap and threatens air safety.

Existing scholarship underscores the disconnect. Batalov (2020) examines the sources of international air law and emphasizes the role of ICAO standards, but does not address construction norms. Kudinov et al. (2020) identify gaps in Russia’s international air service treaties, and Sipos (2023) surveys major international air law conventions. None of these works explicitly links aviation rules with construction law. The present study therefore asks whether incorporating air-safety obligations into international construction contracts (e.g. via FIDIC clauses) and/or adding building-related requirements into air law would mitigate collision risks.

The methodology combines comparative legal analysis of the Chicago and Montreal Conventions, ICAO regulations and FIDIC contract norms with 3D geospatial modeling. Using QGIS and ArcGIS, we created three-dimensional models of tall buildings and airport infrastructure to simulate their impact on flight paths. We also analyzed data from ICAO’s ADREP incident database and reports of real crashes to quantify how regulatory gaps correlate with collisions.

Findings indicate that the lack of unified international standards and divergent national rules significantly increases danger. ADREP data confirm that collisions with power lines and high-rise structures often result in disasters. The aerotropolis model (Charles et al., 2007; Freestone & Baker, 2011) boosts local economies but, without coordinated rules, each jurisdiction sets its own height limits – raising crash risks. In effect, this analysis highlights the urgent need to harmonize construction and aviation norms.

Based on these conclusions, several recommendations are proposed. First, embed mandatory air-safety clauses in FIDIC contracts, requiring contractors to assess and mitigate a project’s effects on airspace. Second, adopt a hybrid legal model combining binding ICAO standards with adaptive national regulations tailored to local infrastructure and planning needs. Third, develop a global automated monitoring system for tall structures near airports – using drones and satellites to detect potential hazards in real time.

Together, these measures should substantially reduce aircraft-structure collisions and support sustainable aerotropolis development, balancing aviation safety with urban and economic interests.

International space law traditionally governs outer space activities – including the exploration and use of celestial resources – and seeks to prevent the militarization of outer space. In parallel, international construction contract law serves as part of international commercial law, providing the legal framework for major cross-border construction projects. Examples include the building of the International Space Station (ISS) and global satellite networks. With the emergence of new space initiatives (such as Elon Musk’s Starlink program) and the ongoing expansion of the ISS, the need for legal coordination between these two fields is increasingly apparent.

The latter half of the twentieth century saw major achievements in space exploration, moving from theoretical research to practical implementation, and creating the international legal framework for space activities. During this period, states actively developed treaties establishing norms of behavior in space, laying the foundations of contemporary space law and institutions. A key instrument was the 1967 Outer Space Treaty, which enshrined the principle that outer space should be used exclusively for peaceful purposes, echoing the 1963 UN Declaration. However, the interpretation of “peaceful purposes” has been legally contested, particularly regarding the placement of weapons in orbit. Disagreements among states and experts led to prolonged debates on militarization as geopolitical tensions rose. The U.S. withdrawal from key arms control agreements in 2001 and 2019 (and Russia’s response to these steps) highlighted the insufficiency of bilateral regimes and the need for more comprehensive international regulation of outer space.

Space law is one of the newest and most rapidly evolving branches of legal science, reflecting a continual increase in the number and complexity of challenges faced in space. A pivotal factor in this evolution is the growing importance of space technologies to the global economy and society. Around 2011, notions of a “Fourth Industrial Revolution” gave rise to the philosophy of “New Space”. This phenomenon is marked by a significant expansion of participants in space exploration and new forms of entrepreneurship based on creating space-based products and services, with most funding coming from private sources. Peter W. H. Peters explains that “New Space” is characterized by a surge in private companies and a shift to an ecosystem primarily financed by private investment and venture capital – in stark contrast to earlier phases dominated by state institutions. Given these changes, “New Space” is transforming the legal and economic foundations of space activities, altering regulatory approaches to space technology deployment internationally.

Today’s humanity faces global challenges – climate change, population growth, the rise of a multipolar world, and resource depletion – which intensify political contradictions among leading states and compel the search for new energy sources and minerals beyond Earth. In this context, P. N. Lozhkovoy notes that space activity has become a key factor stabilizing the world economy and society under these modern pressures. The increasing importance of space is linked to its use in critical areas such as communications, navigation, weather forecasting, and global security, driving not only technological development but also expanding opportunities for financial, cultural, and scientific cooperation regionally and globally – a trend that demands further refinement of the international legal regulatory system.

Particular focus is placed on different approaches to developing “New Space” in various countries. India was selected for analysis due to its unique position; as Nagendra N. Prasad observes, India’s space program is among the world’s most dynamic, thanks to decades of investment, and unlike the programs of the U.S., Russia, or China, India pursues a harmonious development of both state and private sectors in space. This approach underscores the need for a more integrated legal framework that covers both governmental space projects and private enterprise activities, which is vital for addressing new challenges and opportunities in international construction contract law and space development.

The study employed a comprehensive doctrinal analysis of key international legal instruments governing outer space, focusing on their interaction with international construction contract law. Special attention was given to the 1967 Outer Space Treaty, which enshrines fundamental principles of peaceful use of space, still central to modern space regulation. We considered this treaty in the context of its application to contemporary challenges, including infrastructure development, resource management, and prevention of militarization. The research also analyzed standard construction contracts used in major international space-related projects such as the ISS and global satellite deployments.

The results show that the “New Space” transformation of the global economy requires a rethinking of space policy strategies at both the global and national levels, generating substantial demand for legal innovation and adaptation to new realities of space exploration. Our analysis identified key regulatory challenges and prospects in governing the interaction between governments and private actors under international construction contracts for space activities. As noted by A. A. Yanik, the pace of space transformation and its economic impact outstrips existing scholarly understanding, emphasizing the need to refine legal mechanisms for sustainable development in the sector.

One major area of innovation is the use and adaptation of standard-form contracts developed by the International Federation of Consulting Engineers (FIDIC). These contracts play a significant role in harmonizing legal approaches to large international construction projects, including space programs. They create a legal foundation that ensures stability, transparency, and balance of interests among all participants – a critical factor as space activities expand with both governmental and private involvement. In our study, we examined examples of such contracts in international projects (including building orbital infrastructure and launching satellite constellations), highlighting the continuing need to enhance regulatory mechanisms and adapt legal norms to the demands of modern space programs.

In a multipolar world where contradictions between major powers over space use are intensifying, international space law must be revisited. The recent extension of the U.S.–Russia New START treaty (Strategic Arms Reduction) until 2026 played a crucial role in global stability, but Russia’s suspension of the treaty in 2023 amid rising geopolitical tensions showed the inadequacy of bilateral agreements. On one side, the U.S. legitimately points out that China’s absence from the treaty threatens its national interests – especially after China deployed new generation Beidou satellites – while on the other side, Russia recognizes that the U.S. might no longer honor New START under the growing Chinese challenge. This creates a situation where militarization of space and escalation of tensions become nearly inevitable without agreement among all key players on common norms and rules. Meanwhile, the need to unify international standards for building space infrastructure is overlooked. This concerns not only strategic systems (such as reconnaissance and communications satellites, debris removal systems) but also the creation of universal standards for constructing humanitarian-use assets (including rescue satellites). In this context, FIDIC, as an organization with expertise in developing standards for international construction contracts, could take the initiative to establish unified norms for constructing space infrastructure – considering its strategic and humanitarian importance. For example, agreeing on common construction norms for such objects would enhance their compatibility and efficiency, which is especially important in global crises.

Political initiatives – including the creation of the U.S. Space Command – have demonstrated intent to use space as a strategic military domain. This growth of militarization necessitates revisiting existing legal norms to prevent conflicts and to limit weapons placement in orbit. Existing international treaties (like the 1967 Treaty) proclaim peaceful use of space but contain vague formulations that allow different states to interpret them differently and exploit loopholes for strategic maneuvers. This underscores the need for new legal mechanisms aimed at guaranteeing peaceful space use and preventing threats to global security.

At the same time, contemporary space projects – such as building and maintaining the ISS or deploying satellite networks like Starlink – reveal the need for comprehensive legal regulation amid expanding space activities. These projects require not only technical coordination but also legal mechanisms to harmonize international space law with construction law norms. Among the key issues requiring regulation are liability for damage to space objects, the legal status of orbital infrastructure, and the use of space resources.

Since the UN General Assembly established in 1958 the Committee on the Peaceful Uses of Outer Space (COPUOS), the international community has actively pursued coordination and cooperation in this field. This is reflected in numerous UN resolutions aimed at maintaining peaceful cooperation in space and providing a legal foundation for space programs. These documents, including key legal principles in UNGA Resolution 1962 (XVIII) of 1963, emphasize the international commitment to comply with legal norms in space activities, urging states to consider the interests of all countries when using outer space, regardless of their technical capabilities. Special attention is given to equal access to space and its peaceful exploration. These principles have underpinned further development of international space law, creating mechanisms to prevent conflicts related to the military use of space.

Starting in 2015, several countries (including the U.S. and Luxembourg) adopted national laws regulating private companies’ extraction of space resources. These acts provide a legal basis for developing and exploiting planetary and asteroid resources, recognizing private entities’ rights to ownership of extracted materials. For example, the U.S. Commercial Space Launch Competitiveness Act of 2015 expanded opportunities for private companies to participate in space programs and established legal guarantees for commercial use of space resources. This created a precedent and sparked international debate on the legality of space resource utilization and the need for clearer international legal norms in this area.

Legislative initiatives in space economy create important precedents capable of influencing international space law. Our research results show that the surge in private company activity demands a review of existing international norms to ensure clearer regulation of their interaction with states. In this context, V. L. Tolstykh emphasizes the necessity of reforming space law in response to new challenges; his analysis shows that the current legal framework needs refinement to adequately reflect the growing influence of the private sector in space exploration. I. A. Khavanova examines the U.S. Commercial Space Act and underscores that such legislative measures effectively overcome the international prohibition on appropriation of space resources, creating conditions for economic-legal expansion. Her studies analyze national approaches that allow private entities to mine and appropriate resources of celestial bodies, which raises active discussions about the legitimacy of such actions in international legal context.

The rise of commercial space activity involving resource extraction and private initiatives calls for a reconsideration of the international legal regime. Existing norms, while designed to ensure that space remains a demilitarized global commons, are becoming insufficient under modern challenges. The growing number of commercial projects underscores the need to adapt international legal norms, demanding a more detailed approach to regulating the use of space resources. For example, U.S. laws that allow private companies to develop minerals on celestial bodies, despite the Outer Space Treaty’s ban on national appropriation, require further legal elaboration to prevent potential conflicts and to ensure fair resource distribution.

The complexity of constructing space infrastructure – such as lunar bases or Mars colonies – implies not only technical but also extensive legal preparation. The necessity of coordination between space law and construction law, particularly with regard to applying FIDIC standard contracts, becomes clear. Adapting these rules to the specific conditions of the space environment is an important step toward international cooperation and preventing militarization of space infrastructure. As Lozhkovoy notes, space resources play a significant role in building sustainable international cooperation and can contribute to global system development.

Simultaneously, states’ active involvement in technological innovations for resource extraction creates long-term conditions for international security and cooperation. These aspects again underline the importance of global legal coordination and regulation. Debates on the legitimacy of appropriating space resources began in the late 1950s and were reflected in the 1967 space treaty. Eugene Brooks pointed out as early as 1966 that UN resolutions prohibit national appropriation but do not offer clear mechanisms for regulating the exploitation of specific parts of celestial bodies. Modern legal practice shows the necessity to refine existing approaches to adapt to new challenges, including private companies’ access to resources. Brooks’ analysis of “primary rights” to celestial territories parallels contemporary initiatives by some states allowing private actors to mine and use those resources, creating a legal vacuum that requires revision of international norms to prevent monopolization and ensure fair distribution.

Shinkaretskaya in her research emphasizes that contemporary international space law – originally a public-law institution – does not correspond to current realities with private actors’ participation. She observes that since the early 1980s, virtually no new universal treaties in this area have been adopted, resulting in regulatory gaps. Consequently, domestic laws and private regulatory mechanisms (through civil contracts between private entities) have begun to play a larger role, forming new norms that international law does not always cover. Shinkaretskaya concludes that this situation fosters the development of de facto unified norms through private-state agreements, but requires coordinated international efforts to address pressing issues such as delimiting airspace and outer space and the concept of the “launching state”.

This study focuses on the dynamics of interaction between private and state actors in space activities, emphasizing the legal problems arising from increased commercial involvement. In contrast to Shinkaretskaya’s analysis, our findings demonstrate the need to update existing international norms to adapt them to new realities caused by active private participation in space projects. In particular, we underscore the importance of developing legal mechanisms that ensure equitable resource distribution and reduce the likelihood of conflicts. The conclusions emphasize the necessity of updating international norms to prevent militarization of space infrastructure and to create a sustainable legal field that harmonizes international and national legislation aimed at space industry development.

Modern space law faces complex tasks, one of which is regulating the use of resources in outer space. A key document on this issue is the 1979 Moon Agreement. This international treaty imposes strict limitations on commercial exploitation of space resources, emphasizing that celestial bodies should be used exclusively for the common interest of humanity. In particular, the Agreement prohibits any economic activity related to mining and appropriation of resources on celestial bodies, banning their commercial use. This legal regime imposes significant constraints on potential economic initiatives in space, and its principles, as Gaggero and Ripoll note, are aimed at restricting privatization of space resources and preserving them for the global good.

The main problem with the Moon Agreement is that the largest space powers – Russia, the U.S., and China – have not signed it. This leads to legal uncertainty regarding the future use of space resources, as the lack of consensus among leading states casts doubt on its efficacy and enforcement.

Examples of national legislative initiatives – such as Luxembourg’s measures to regulate the commercial use of space resources – demonstrate a desire to bring order to this field. At the same time, rising competition among world powers (USA, Russia, China) increases the significance of the military component of space programs. In 2018, U.S. President Donald Trump signed an order establishing the United States Space Command, which manages U.S. military operations in space, underscoring the strategic importance of space to national interests. In this context, A. V. Iglin emphasizes the necessity of new legal mechanisms to control space militarization and maintain its peaceful status.

Russia is also actively developing its space forces, highlighting the importance of international cooperation in the space sphere. However, as Shinkaretskaya notes, the expansion of military space programs requires coordinated efforts by the international community to prevent the turning of outer space into a combat zone.

In conclusion, the research finds that integrating international space law with international construction contract law is essential to ensure sustainable and peaceful use of outer space amid growing commercialization and private-sector involvement. The analysis shows that existing international norms, such as the 1967 Outer Space Treaty, need adaptation for effectively regulating commercial exploitation of space resources and preventing militarization of space infrastructure. The use of FIDIC standard contracts has proven significant in unifying legal approaches to major international construction projects in the space domain.

The findings underscore the need to update international space law by creating detailed rules for commercial space resource use, which will eliminate legal gaps and ensure fair resource allocation. Furthermore, it is necessary to integrate FIDIC construction standards into space infrastructure projects, ensuring legal consistency and preventing conflicts between state and private participants in space activities. Such measures will help harmonize international and national legislation aimed at space industry development, strengthen international cooperation, and prevent the militarization of space.

In a multipolar world where several countries play significant roles in space, national interests – including those of Russia – become key in shaping international legal norms. Russia, as one of the leading space powers, seeks to safeguard its strategic security and economic interests in outer space, requiring coordinated international efforts to refine legal norms and regulatory mechanisms. Given geopolitical changes and intensified global competition, developing agreed international rules will form the foundation for stable and secure space exploration by all nations. Achieving long-term stability and security in outer space thus requires concerted international action to improve legal norms and regulatory mechanisms. This will not only effectively address current legal challenges but also build a solid foundation for future space initiatives, promoting peace and prosperity for humanity in space.

International economic law comprises a myriad of norms regulating global economic relations—such as trade, investment, and inter-state cooperation in various sectors. A key aspect of international economic law is international construction contract law (ICCL), which governs relations and obligations arising in cross-border construction projects. ICCL requires specialized regulation due to the complexity of such projects and the need to account for diverse national and private interests. International legal cooperation in this field promotes the development of unified standards and norms, easing parties’ interactions and safeguarding their rights in construction agreements. The unification of contract forms through standard contracts plays an important role in this process. Lucas Klee emphasizes the centrality of legal unification via the model contracts developed by the International Federation of Consulting Engineers (FIDIC).

The drive to unification through FIDIC forms stems from the need to establish consistent legal frameworks that facilitate orderly contractual relations among parties in international construction projects. The application of FIDIC’s standard form contracts significantly reduces legal and financial risks during project execution, ensuring greater predictability of legal outcomes and an effective allocation of responsibilities among participants. This simplification of risk management supports project oversight and enhances compliance with international norms and standards in the construction industry.

This study focuses on the role of international legal mechanisms in unifying and regulating cross-border construction contracts. The research is grounded in comparative legal analysis and legal reasoning, including examination of international legal instruments and FIDIC’s model contracts, as well as broader transnational regulatory frameworks. Special attention is paid to the interaction between national and international norms, which allows for a deeper understanding of the role of transnational corporations (TNCs) in international construction law. Using statutory acts, doctrinal sources, and examples from actual infrastructure projects, the analysis yields conclusions and recommendations on legal unification and ensuring economic security.

FIDIC’s model contracts play a key role in harmonizing construction contract norms internationally. The creation and use of unified contract templates ensure standardization of legal frameworks and help reduce uncertainty for contracting parties. By employing FIDIC standard forms, project participants obtain guarantees about risk distribution and responsibilities, which is especially important in complex transnational projects. This leads to more effective project management and fosters trust among parties, thereby enhancing the predictability and stability of legal consequences in the construction sector.

Transnational corporations have become one of the driving forces of globalization in the world economy. They significantly influence the development of international economic law and legal cooperation in various economic sectors, including international construction contract law. TNCs actively participate in the execution of large cross-border construction projects, necessitating specialized regulation and harmonization of standards across jurisdictions. According to UNCTAD data, the number of TNCs worldwide grew from just a few hundred in 1939 to nearly sixty thousand by 1999, reflecting their rapidly expanding influence in the global economy.

Most TNCs are headquartered in developed countries, but they actively expand operations in developing regions (approximately 65% of firms have affiliates in developing countries). The global reach of their activities underscores the need for unified international regulation. A key driver of TNC expansion is the limitation of domestic markets, prompting companies to enter international arenas to sustain production growth. In a context of global competition and antitrust regulation, TNCs aim to leverage their advantages in foreign markets, necessitating the creation of unified legal mechanisms in international construction contract law. This unification protects project participants’ interests and harmonizes regulatory acts, thereby promoting economic development and strengthening international cooperation.

TNC influence tends to diminish the traditional role of the state as the primary regulator, elevating these corporations to important subjects on the world political and economic stage. Each state, as a member of the global economy, strives to secure its national interests, but given the limited and uneven distribution of world resources, relations inevitably become competitive or even conflictual. This is particularly true in international construction, where competition for resources and markets can lead to legal disputes that require international cooperation for their resolution. As V. B. Mantusov notes, competition between state and non-state actors necessitates effective mechanisms of international economic law to ensure stability and mutually beneficial cooperation.

In multilateral regulations of TNC activity, international legal norms play a central role. The "Charter of Economic Rights and Duties of States" (1974) was among the first instruments to address TNC regulation, emphasizing states’ key role in establishing and enforcing legal frameworks for corporations. Article 2 of the Charter grants every state the sovereign right to regulate and control foreign investments within its jurisdiction. This provision empowers states to set rules for foreign investors in line with national priorities—whether that be stimulating growth, protecting domestic markets, or ensuring sustainable development. The Charter also authorizes governments to regulate TNC activities on their territory, requiring these enterprises to align with the economic and social policies of the host state. Thus, a balance is achieved between attracting investment and protecting sovereign interests.

Furthermore, the Charter stipulates that TNC activities must not threaten the political stability or social structure of host states. This requirement is especially relevant for developing nations, where corporations can have a profound impact on domestic processes. States must develop mechanisms to prevent unwanted TNC interference in domestic affairs while balancing the need for foreign capital with the protection of national interests. Ultimately, the Charter’s TNC provisions aim to maintain internal stability and foster national economic development, all while respecting international obligations.

However, the influence of the 1974 Charter on international TNC regulation was weakened by the reaction of some states. For example, the United States opposed the Charter’s stringent provisions, viewing them as a threat to free trade and American business interests. This opposition led to revisions in the 1980s and the emergence of a new concept—“international economic security.” In 1987, the UN General Assembly discussed this concept, partly echoing the Charter’s themes but without establishing a binding system of rights and obligations. Notably, S. L. Natapov observes that international human rights–related instruments—such as the "Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights"—play an important role in setting behavior standards for corporations, but their effectiveness depends on implementation at the national level.

In 1992, a UN-sponsored review of the Charter significantly diluted its authoritative status and broadened the freedom of action enjoyed by TNCs internationally. This shift had a tangible impact on international construction practice, where corporate social responsibility (CSR) has taken on increasing importance. CSR is now viewed by corporations not only as an ethical imperative but as a strategic risk-management tool aimed at sustainable development and compliance with international norms. Karandeev and Slinko note that active business social policies strengthen relations between corporations and local communities, contributing to sustainable socio-economic development of regions. In effect, CSR has become an important compensatory mechanism for the weakened supranational regulation, helping to maintain trust and stable development.

At the national level, foreign direct investment (FDI) regulations remain a key tool for managing TNC activities in construction. TNC involvement in cross-border projects is crucial for infrastructure development and economic growth in host countries. Indeed, new companies often emerge as transnational entities from inception, immediately participating in international projects. Motivations for TNC investment in construction can be classified as follows: expansion into new markets for services and technologies, optimization of production through innovations, access to host-country resources (materials and labor), and acquisition of new assets (intellectual property, specialized equipment). All these factors drive technological development and strengthen companies’ competitive positions.

TNC investment patterns have evolved in line with catch-up development strategies adopted by many countries. According to F. S. Gubaidullina (2023), attracting FDI has become essential for narrowing the gap with economic leaders. Countries aim to modernize their economies by acquiring advanced technologies and management practices, actively engaging TNCs in major infrastructure projects. In practice, TNC investments may take the form of mergers and acquisitions or greenfield projects (building new ventures from scratch). Investment volumes in construction continue to grow, playing a pivotal role in global infrastructure development. Gubaidullina highlights that successful FDI inflows enhance production capacity and competitiveness in host countries, but require favorable institutional conditions—such as tax incentives and special economic zones. For example, countries in Southeast Asia like Singapore and South Korea achieved significant progress by actively attracting foreign investments, which fueled the development of high-tech industries and integration into the world economy. In summary, TNC investment in construction remains a powerful driver of economic growth and modernization, yet it necessitates careful regulation tailored to each country’s context.

The concept of economic security is a cornerstone of modern international economic law and cooperation. In an era of global competition and increasing political instability, ensuring economic security is vital for the stability and success of large overseas infrastructure projects. Economic security can be understood as a synthetic category at the intersection of economics and political science, encompassing notions such as economic independence, resilience, and adaptability. According to Krutikov and colleagues, it is based on the ability of a state and its economy to withstand external and internal threats, minimizing their impact and ensuring stability and development.

In the context of ICCL, economic security manifests through the management of political, financial, and institutional risks that can affect project implementation. A key component of the concept is economic stability, achieved via structural reforms, innovation support, and the creation of favorable conditions for investment, including foreign investment. In a multipolar world, many risks and threats are transnational, necessitating comprehensive security strategies. This is especially true for international construction projects, which often depend on external investments and partnerships. Economic security in this context aims to safeguard critical economic interests, ensure sustainable development, and minimize dependence on foreign influence. A crucial aspect of economic security is its link to sustainable development: sustained economic growth, job creation, infrastructure development, and improved living standards are central to long-term stability. This linkage is particularly important in construction, where long-term investments require state support, including measures to prevent economic and social risks.

The notion of security—especially economic security—occupies a prominent place in international law and cooperation, including within ICCL. It encompasses the protection of the vital interests of individuals, society, and the state from internal and external threats. In a multipolar world, the task of economic security is also to protect the rights, freedoms, and social guarantees of citizens of different states, in accordance with their national constitutions and international norms. The resilience of an economic system, particularly in construction, indicates the reliability of international contractual relationships and the ability to adapt to internal and external shocks.

Developing a concept of economic security in construction law involves analyzing its theoretical foundations within international economic law, and examining the interplay between global processes and regional economic realities. Conceptualizing the phenomenon with respect to international construction contracts allows key risks and management mechanisms to be identified, providing an essential basis for ensuring the stability of contractual linkages. For instance, T. Yu. Feofilova proposes an approach linking regional economic security with theories of regional economics, delineating levels and indicators of security. This approach takes into account regional economic specifics and international processes, which is significant for construction law. Feofilova also emphasizes detailed risk management: identifying risk-creating factors and threat-formation factors, thus structuring the mitigation of negative impacts on a region’s socio-economic system. In practical terms for international projects, this implies establishing protection and adaptation mechanisms that minimize external threats and ensure long-term contractual resilience. This approach is particularly relevant as the multipolar world places new demands on economic risk management and the maintenance of stable economic linkages.

International economic security is defined not only by measures stabilizing international economic relations but also by the legal frameworks that regulate global economic activity. In ICCL, this translates to a legal guarantee of protecting the interests of all project participants while taking into account resource capacities and territorial specifics. Ensuring stability and shielding from external influences at the regional level is achieved through international cooperation and harmonization of legal norms, which helps establish sustainable economic ties and reduces the risk of adverse external effects.

National economic security encompasses a range of components – from demographic, informational, and political factors to social welfare and defense. Its effectiveness largely depends on the appropriate application of international economic law norms. A. A. Rychagova highlights that globalization generates new challenges and threats to economic security, affecting economic actors at all levels. She concludes that the impact of global factors requires a strategic approach to maintaining economic stability and defending against negative external influences. Such approaches are crucial for the resilience and security of international economic operations, including construction projects. This multi-level interaction between international and national legal norms in economic security fosters a stable and safe environment for executing international construction contracts, thereby ensuring long-term stability and development of regions.

Approaches to understanding economic security can vary significantly across national traditions and legal systems. For example, Western models – including the American model – emphasize sovereign decision-making in economic affairs and the maintenance of high living standards. This is reflected in legal requirements for international construction agreements, which often include strict conditions and protection of national interests during international engagement. K. S. Alpysbayev underscores the importance of economic security policy within corporate governance: research in Kazakhstan shows that effective risk management and strategic corporate development contribute to safeguarding companies’ economic interests on the international stage.

In Russian practice, economic security is generally viewed through the lens of ensuring stable socio-economic development and protecting national interests. This perspective influences legislation on international construction law and the conditions under which Russian companies participate in global projects. The Russian approach focuses on maintaining stability amid internal and external turbulence, shaping methods of risk management and protecting the economic interests of the state and business. A. A. Remezkov defines economic security as the state of a country’s productive forces that ensures protection of national interests and competitiveness. Despite the definition’s age, it remains relevant in today’s conditions of international economic law and cooperation. In a multipolar world with complex economic relations, the role of economic security continues to grow. In ICCL, ensuring economic security requires effective legal mechanisms aimed at protecting project participants’ interests and accounting for the resources and particularities of each territory.

The analysis underscores the significance of international construction contract law within the broader context of international economic law, with a focus on unifying legal mechanisms and strengthening international cooperation. Attention was given to the choice of applicable law, the regulation of cross-border construction projects, and the role of transnational corporations. The results confirm that unified FIDIC contract forms substantially reduce legal and financial risks, enhancing the predictability of legal outcomes and promoting the harmonization of norms on the international stage.

The study reveals the importance of further unifying legal norms in the sphere of transnational construction. The use of FIDIC’s model contracts has a pronounced effect on risk reduction and improving cooperation between project parties, highlighting the need for continued development and adaptation of international standards in a multipolar world. As active participants in international projects, transnational corporations require effective legal regulation and alignment of national and international norms.

Special attention in the recommendations is given to the challenges of regulating TNC activity in a multipolar world experiencing a surge of international projects. Strengthening legal oversight and ensuring compliance with FIDIC standards are critically important for protecting national interests and harmonizing legal norms. Achieving this requires international legal cooperation aimed at enhancing the stability and security of contractual relationships.

Based on the analysis, it is recommended to continue the unification of standard FIDIC contracts and to adapt them to current international challenges. Improving international legal control over TNC activities is also necessary to ensure sustainable development and economic security in the construction sector. These measures will facilitate better cooperation between parties, protect their rights, and contribute to a stable legal order in the international construction industry.

In an era of consolidated multipolarity and deepening integration, transnational linkages have become system-forming in sectors where public-law requirements intersect with private-law obligations. International Construction Contract Law (ICCL) emerges precisely at the interface between public international law and private international law: the parties’ civil-law obligations arise and are performed within the force field of multiple national legal orders and supranational norms developed by international organizations that set conduct standards for participants in the global construction market (Klee, 2018).

The growing scale of cross-border projects, the complexity of technological solutions, and the diversification of financing sources have objectively increased the number of actors and legal regimes drawn into the contractual frame. This has exposed the problem of conflicts of laws—situations in which the same relationship falls under competing regulatory claims of different legal systems whose norms either diverge or contradict each other. For international construction transactions, this necessitates aligning domestic law with international prescriptions and building resilient mechanisms for the selection and coordination of the applicable law (Kudryavtseva & Mkhitaryants, 2024; Kuts, 2022).

Among the instruments for overcoming conflicts, the doctrine of public policy (ordre public) occupies a special place. Both negative and positive public-policy reservations safeguard the fundamental interests of the forum State and uphold the stability of international private-law relations by allowing the forum to decline the application of foreign law that contradicts critically important values of the receiving jurisdiction (Shulakov, 2023). In ICCL—where actors from different legal cultures interact—accurate deployment of public-policy controls is key to predictability and the perceived legitimacy of the contractual regime.

Procedural coordination across systems is equally determinative. In any cross-border dispute, a court or arbitral tribunal must inevitably resolve three questions: which procedural norms apply; which forms of evidence are admissible; and by what criteria the record will be assessed. Divergences among national procedural models can affect the outcome and the effective exercise of procedural rights by the parties and by third persons whose interests are touched by the decision (Kudryavtseva & Mkhitaryants, 2024). Procedural legitimacy therefore requires attention to the comparability of guarantees across jurisdictions and, wherever possible, the development of harmonized approaches to admissibility and evidentiary evaluation.

Enforcement is the third chokepoint of conflict-of-laws governance. Recognition and enforcement of foreign judgments and arbitral awards confront differences among national procedural regimes, public-policy objections, and reciprocity tests. Balancing creditor and debtor interests in cross-border enforcement depends not only on judicial practice, but also on the institutional design of enforcement authorities (Fedin, 2023). In construction investment projects, weak predictability at the enforcement stage translates directly into the cost of capital and the risk premium.

International organizations are pivotal in constructing a coherent regulatory framework. The United Nations, the BRICS New Development Bank, the World Bank, and UNIDROIT initiate and sustain standards and procedures for resolving multilateral disputes and for unifying private-law regimes whenever a foreign element is present. In the construction sector, standard forms published by the International Federation of Consulting Engineers (FIDIC) have particular significance, having become widely used at the design, construction, and operation stages across multiple States (Klee, 2018). Analysis of current FIDIC documentation evidences the need to unify not only contractual architectures but also procedural norms that secure consistency and transparency in application (Kudryavtseva & Mkhitaryants, 2024).

The European vector of harmonization in conflicts and procedure is illustrative. The Rome I and Rome II Regulations entrench systemic approaches to choosing the applicable law for contractual and non-contractual obligations and articulate the construction of overriding mandatory provisions and public policy in their political, social, and economic dimensions—echoing F. C. von Savigny’s classical ideas on coordinating legal orders (von Savigny, 2011). The Opinion of Advocate General M. Szpunar, addressing the reach of overriding mandatory rules and public-policy protection, confirms the resilience of this methodology in contemporary EU law (Szpunar, 2016). National enactments and codifications in newer EU Member States (for example, Croatia) illustrate “re-thinking with borrowings,” where local specificities are layered onto common EU frames (Zupan, 2021).

The Russian approach to overriding mandatory rules and public policy, while sharing the same foundational dimensions (political, social, economic), has a distinct configuration. Article 1192 of the Civil Code and the Supreme Court’s Plenum Resolution of 9 July 2019 No. 24 identify markers of public policy that emphasize protection of sovereignty and security (e.g., limits on land turnover to foreign persons), protection of the rights of participants in civil circulation (including marriages with foreign citizens), and protection of national economic interests (restrictions on acquiring stakes in strategic sectors) (Dmitrieva, 2016). This is a comparatively “defensive” model when set against the Savignian tradition oriented toward inter-systemic coordination (von Savigny, 2011).

Conflict rules in ICCL operate primarily through party autonomy: the parties may determine the law governing the contract, its form, and the consequences of breach, as well as select fora for dispute resolution. Articles 1210–1215 of the Russian Civil Code provide the legal basis for choice of law in cross-border contracts, taking into account the criterion of the closest connection and other connecting factors. In international doctrine, the evolution of recognizing party autonomy for non-contractual obligations has further expanded the space for contractual coordination in complex construction and financing schemes (Kutashevskaya, 2022; Guskov & Sichinava, 2021). At the same time, reference to international benchmarks—including the bodies of work produced by international organizations and soft-law instruments—supports uniformity in project design and reduces transaction costs (Klee, 2018).

Where public entities participate in construction projects, questions of State immunity and the jurisdictional reach of foreign courts and arbitral tribunals arise. Even where the contract contains a choice-of-law and arbitration clause, the law chosen by the parties may be cut back by the forum’s overriding mandatory rules invoked to protect fundamental values (the model reflected in Rome I for such provisions) (Szpunar, 2016). This directly affects risk allocation, the content of guarantees, and the architecture of dispute-resolution procedures.

Incomplete harmonization remains a source of uncertainty. International private-law treaties are frequently implemented only in part and without sector-specific calibration to construction, reducing the predictability of outcomes. Technical-legal defects—stemming from incoherence among enactments and terminological heterogeneity—undermine regulatory unity (Kozhokar, 2020; Zanina, 2019). Core terms such as “closest connection,” “public policy,” and “overriding mandatory rules” are filled with divergent meanings across legal traditions, calling for doctrinal and normative fine-tuning.

Good faith stands out as a key regulatory principle whose under-protection is documented in the literature. In ICCL, the normative entrenchment of good faith and of mechanisms for its operationalization in contractual and non-contractual relations offers a path to reducing conflicts of interest and strengthening confidence in adjudication (Kudryavtseva & Aleksandrov, 2019). This is critical for long-term projects in which external conditions (prices, sanctions, transport corridors) inevitably shift and contractual and scheduling adjustments require legal “safety valves.”

The procedural architecture of Russian jurisdiction in matters with a foreign element is another structural node. Judicial competence, evidentiary study and assessment, and the application of procedural law in cross-border disputes are regulated in the Civil Procedure Code and the Arbitrazh Procedure Code, providing a base for integrating public- and private-law interests in construction disputes. The 1970 Convention on the Taking of Evidence Abroad and the 1965 Convention on the Service Abroad of Documents simplify engagement with foreign authorities, but differences in domestic procedures incentivize forum shopping and parallel proceedings (Solodilov, 2023). Thus, in the absence of a “hard” rule in Article 406 of the Civil Procedure Code regarding priority for a previously commenced foreign action, duplicative litigation is possible despite approaches reflected, for example, in the Chisinau Convention (Article 29) (Solodilov, 2023).

Targeted institutional solutions can mitigate fragmentation risks: a special federal statute to unify and streamline cross-border procedural acts (including electronic communications, expedited document exchange, and standardized evidentiary requirements); ratification of the 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments to increase predictability of investor protection; and digitalization of enforcement proceedings as a technological basis for end-to-end traceability and proportionality of coercive measures (Ustimova & Rasskazova, 2022; Fedin, 2023).

In sum, ICCL operates as a multi-level regime in which public-law safeguards (overriding mandatory rules, public policy, immunity) are interlocked with private-law instruments (party autonomy, choice of law and forum, contractual adaptation) and are operationalized through FIDIC standards, judicial-arbitral practice, and procedural conventions. Harmonizing legal norms, strengthening procedural bridges among jurisdictions, and developing digital tools for evidence and enforcement are strategic priorities capable of reducing risk costs and enhancing the resilience of transnational construction initiatives (Klee, 2018; Kudryavtseva & Mkhitaryants, 2024; Solodilov, 2023).

International environmental law is a well-established branch of public international law, recognized by legal scholars worldwide as fundamental in developing mechanisms to prevent transboundary environmental threats and ensure sustainable development. In contrast, international construction law is still emerging as both an academic and practical discipline. Although many foreign experts already regard this field as consolidated — evidenced by seminal works such as W. Breyer’s International Construction Law: An Overview (Breyer, 2024), W.K. Venoit’s International Construction Law (Venoit, 2009), D. Wightman and H. Lloyd’s International Construction Law Review (Wightman, Lloyd, 2002), and C.B. Molineaux’s International Construction Law (Molineaux, 1998) — in countries like Russia this discipline began to develop relatively recently. For example, a course on International Construction Law is now offered at the Higher School of Economics in Moscow under Dr. G.A. Pakerman, covering topics such as legal regulation of international construction contracts, the application of FIDIC (International Federation of Consulting Engineers) standard forms, the rules of the International Chamber of Commerce and UNCITRAL, and mechanisms for resolving cross-border disputes. Notably, four of the five founding BRICS countries — Brazil, India, China, and South Africa — are members of FIDIC, underlining the global relevance of these standards (including their importance for Russia).

On the international stage, a more focused subfield is coalescing: International Construction Contract Law (ICCL), concentrating on the terms and conditions of cross-border construction contracts. In Russian-language scholarship, attention is drawn to works like Ya. A. Anosov’s Legal Regulation of International Construction Contracting in EAEU Countries (Anosov, 2022) and I.A. Goddard’s International and National Legal Regulation of Transboundary Construction Contracts (Goddard, 2018). Globally, doctrinal studies of ICCL include works such as L. Klee’s International Construction Contract Law (Klee, 2018) and D.I. Imamova’s The Concept of an International Construction Contract (Imamova, 2023).

Principles of lex constructionis and the FIDIC standard contracts play a special role in the formation of ICCL. These model contracts provide universal legal tools for risk management, minimization of disputes, and enhancement of legal predictability in cross-border construction projects. FIDIC forms incorporate detailed risk-allocation clauses and multi-tiered dispute resolution mechanisms (including Dispute Adjudication Boards, DAB/DAAB) that help reduce conflicts and ensure project stability. The role of international financial institutions such as the BRICS New Development Bank (NDB) has also been critical, as they require environmental risk assessments before granting loans or underwriting projects. This demand drives the development of mechanisms to integrate environmental standards into the legal framework of international construction contracts.

According to the 1992 Rio Declaration, sustainable development requires balancing economic growth, social justice, and environmental protection. The United Nations Environment Programme (UNEP) coordinates the implementation of environmental agreements, developing methodologies and guidelines. In this context, O.N. Otrashevskaya et al. (2023) emphasize the significance of quasi-judicial non-compliance procedures for monitoring compliance with international environmental obligations. These mechanisms play a key role in resolving issues related to adherence to environmental norms and in enforcing contractual environmental obligations through specialized compliance committees, such as those established by the Aarhus Convention and other agreements. Furthermore, F.F. Nazirov and T.E. Sedankina (Nazirov, Sedankina, 2024) highlight the supportive role of Islamic law in advancing sustainable development. Grounded in the principles of himma (collective welfare) and haram (the forbidden), Islamic legal systems promote environmental responsibility and sustainable use of natural resources. Countries like Morocco and Saudi Arabia actively integrate these principles into their national legislation and international commitments by ratifying key environmental agreements including the Paris Agreement. The combination of quasi-judicial compliance procedures with the religious-legal principles of Islamic law has been shown to strengthen global initiatives toward sustainable development and adherence to environmental standards.

Recent trends in international environmental law demonstrate a shift from intensifying normative regulation to improving the effectiveness of implementing existing agreements. Under such mechanisms, measures can range from financial and technical support to restrictive sanctions. For example, the CITES committee is empowered to impose trade bans on certain species if a state violates its obligations to protect natural resources, and the Aarhus Convention’s Compliance Committee can limit parties’ procedural rights when obligations concerning access to environmental information and justice are not met.

International construction contracts must heed the stringent requirements of international environmental standards established by agreements such as the 2015 Paris Agreement. This underscores the importance of studying international environmental law in the context of construction contracts, where environmental requirements may conflict with the commercial interests of the parties. In their study, I.M. Lifshits, A.S. Smbatyan, and M.R. Saliya (Lifshits et al., 2024) focus on the legal aspects of implementing the Paris Agreement among Eurasian Economic Union (EAEU) countries, aimed at reducing greenhouse gas emissions and achieving carbon neutrality. National legal systems are the primary drivers of these commitments: for example, Russia and Kazakhstan strive for carbon neutrality by 2060, while Belarus and Armenia aim for 2050, which is important for synchronizing environmental and construction measures. The authors note that sectoral nationally determined contributions reflect the desire of countries to account for local conditions while still supporting global climate and sustainability goals. They further argue that developing a common carbon regulation system within the EAEU is necessary for effectively implementing climate measures, especially in sectors that significantly impact the environment such as construction and infrastructure.

The core principles of international environmental law — including the precautionary principle and the concept of sustainable use of natural resources — form the foundation of the global legal framework for sustainable development. The principle of “common but differentiated responsibilities” (CBDR) allocates states’ obligations based on their economic capacity and level of development. In international construction contract law, this means developing countries may have relaxed environmental duties compared to developed countries. As L. Rajamani observes, this reflects the need to consider differing economic and technological capabilities when implementing large infrastructure projects. In recent decades, compliance control mechanisms have become a crucial element of various international agreements, such as the 1997 Kyoto Protocol, the 1987 Montreal Protocol, and the 1998 Aarhus Convention. These procedures establish an international legal framework for environmental protection that states implement in their national laws, ensuring that participants in construction projects observe environmental standards.

Another key aspect is the use of Environmental Impact Assessment (EIA) as a crucial tool for preventing environmental risks arising from large-scale construction projects. The EIA process requires a mandatory preliminary evaluation of the potential impacts a project may have on the environment before implementation. This includes analyzing factors such as effects on ecosystems, air and water quality, and public health. EIA not only promotes a more prudent and responsible approach to project planning but also ensures alignment with sustainable development principles by integrating environmental considerations at early design stages. Professor Alan Gilpin (Gilpin, 1995) notes that incorporating EIA into international construction contracts has become a key element of effective environmental risk management. This process helps minimize negative environmental impacts and creates balanced conditions for reconciling commercial interests with environmental protection requirements. Such an approach is especially pertinent as the scale of construction activity increases and environmental compliance demands grow stricter. Effective use of EIA can help prevent conflicts between commercial projects and environmental interests, enabling more sustainable and safer development of the construction industry at the international level. It is likely that in coming years we will see greater use of “hybrid” contracts combining mandatory legal norms with voluntary environmental standards to reduce the carbon footprint of construction projects.

Furthermore, the integration of international environmental law into construction contracts is evident in parties’ commitments to adhere to international environmental standards. This includes applying “green” building benchmarks such as BREEAM and LEED, which help minimize a project’s environmental impact (Kubba, 2012). The study found that international environmental standards like LEED, BREEAM, DGNB, Green Star, and WELL play an important role in the evaluation of projects financed by international banks, including the BRICS NDB and the Asian Infrastructure Investment Bank (AIIB). The sustainability policies enshrined in these banks’ documents mandate careful attention to the environmental and social responsibility of projects, aligning with key principles of those standards. Moreover, certification under systems like BREEAM and LEED boosts energy efficiency, lowers operating costs, and minimizes environmental risks, making projects more attractive for international financing. Such certifications also enable banks to issue “green bonds” for sustainable financing and build investor confidence. LEED and BREEAM, being the most widespread standards, are often used to evaluate large-scale infrastructure projects. The German DGNB standard stands out for emphasizing a balance of environmental, economic, and social aspects, while WELL and Green Star focus on user health and biodiversity preservation. These standards enhance project transparency, which is important for long-term international investments. Incorporating environmental criteria into project appraisal ensures that financed projects will be not only profitable but also sustainable, meeting contemporary climate change challenges. As a result, banks that integrate these approaches act as key drivers of the global environmental agenda, setting benchmarks for sustainable development. It can be anticipated that certification schemes will expand to include new biodiversity and climate adaptation indicators.

One of the main challenges facing international construction companies is complying with national and international environmental regulations, which become more stringent each year. L. Zhang et al. (2023) underline the importance of implementing cleaner technologies and improving cost efficiency to achieve sustainable development goals. A telling example of balancing environmental responsibility with investor rights is the arbitration between Costa Rica and Compañía del Desarrollo de Santa Elena S.A. (CDSE). The Costa Rican government expropriated a tract of land owned by CDSE to create a protected natural area. This led to arbitration at the International Centre for Settlement of Investment Disputes (ICSID), where CDSE claimed a violation of property rights and inadequate compensation for the taking. The award in favor of the company highlighted the importance of maintaining a balance between the state’s environmental interests and the rights of investors.

Early implementation of EIA during the planning and execution of construction projects often helps reduce potential negative consequences, strengthen resilient infrastructure, and ensure compliance with international environmental obligations.

This study developed universal approaches to integrating principles of international environmental law into ICCL. Particular attention was given to theoretical aspects such as the need to incorporate sustainable development principles into legal constructs, to include environmental risks within general categories of force majeure, and to adapt international standard contracts to domestic conditions. These measures foster the harmonization of legal systems and contribute to the creation of a unified international framework for regulating cross-border construction projects.

On a practical level, it was found that all large-scale construction projects analyzed inevitably faced external, internal, and hybrid types of environmental threats. Including special mechanisms in contracts for identifying, analyzing, and mitigating such risks will help achieve a balance between economic interests and environmental safety. This approach accords with the sustainable development principles enshrined in international agreements and takes into account the requirements of international financial and insurance institutions (such as the NDB) for conducting environmental risk assessments before issuing loans or policies.

Allocating unforeseen and uncontrollable risks among construction participants should be based on lex constructionis principles identified in this research, including the duties of due diligence and good faith. These principles provide the foundation for developing flexible mechanisms to respond to changing circumstances (such as natural disasters or industrial accidents), allowing contractual obligations to be adjusted and ensuring equitable risk distribution. When preparing international construction contracts, special attention should be paid to formulating provisions on unforeseen circumstances, force majeure, impossibility of performance, and excessive onerousness of obligations (hardship). These clauses define mechanisms for responding to changes in conditions during project execution, including extraordinary external events like natural disasters or technological catastrophes, and they enable revision of the parties’ obligations to protect their interests and minimize losses. It is advisable for contracts to include specific clauses requiring timely notice of unforeseen events, mandatory compliance with environmental standards, and the integration of EIA procedures at the contract negotiation stage. (Notably, unlike some civil law systems, English common law — as reflected in House of Lords precedent — does not recognize a broad doctrine of hardship, which makes it all the more important to include explicit force majeure and hardship clauses in cross-border contracts. Similarly, U.S. law codified in the Restatement (Second) of Contracts provides doctrines of impracticability and frustration of purpose that parallel these contractual mechanisms.)

A comprehensive approach to risk allocation — including environmental obligations (such as LEED, BREEAM, DGNB, WELL, and Green Star certifications) at the contract formation stage — is essential. It is recommended to adapt international contract mechanisms (for example, FIDIC standard forms) to account for sustainable development priorities. One concrete measure could be requiring the use of international environmental standards and EIA processes in project contracts. The findings confirm that integrating environmental standards and international regulatory mechanisms (such as FIDIC model contracts), while accounting for local conditions, not only enhances the resilience of infrastructure projects but also strengthens the competitive position of participants in global construction markets. Implementing the proposed mechanisms contributes to the achievement of sustainable development goals and increases legal certainty in transnational construction projects. The approaches developed can be used to adapt FIDIC standards and incorporate environmental standards into the execution of cross-border projects. Adopting these approaches will improve the sustainability of infrastructure projects, bolster the competitive positions of companies internationally, and help realize the objectives of sustainable development.

International energy agreements are a decisive factor shaping the parameters of international construction contracts in the energy sector. Their influence is felt at normative, institutional, and economic levels: by imposing public-law obligations on market participants, by structuring transparent regimes for transit and investment, and by setting price and technology benchmarks that project sponsors must internalise. Within today’s architecture of multilateral regulation, the 1994 Energy Charter Treaty (ECT) occupies a central position. As noted in Russian and foreign scholarship, it was the first multilateral instrument to protect energy investments and to establish a legal regime for cross-border energy transit; it also conferred on investors a right of direct recourse to international arbitration against host States (Golovanova & Kuklina, 2020; Konoplyanik & Walde, 2006). For EPC/EPCM contracts on energy infrastructure, this translates into the need to incorporate investment-protection clauses and to align dispute-resolution provisions with the availability of ICSID proceedings, while preserving appropriate commercial arbitration fora for purely contractual disputes.

Against the backdrop of an accelerating energy transition and a shifting balance of power, the European Union’s regulatory initiatives—chiefly the Third Energy Package—exert an extraordinary impact on the negotiation and performance of construction contracts connected with electricity and gas markets. EU rules on liberalisation, non-discriminatory third-party access and unbundling cascade into techno-legal obligations for employers and contractors, including interoperability requirements, environmental permitting, and competition-law compliance (Chugunov, 2022; Gudkov, 2016). In contractual terms this prompts Particular Conditions addressing third-party access commitments, ring-fenced accounting, and more granular risk matrices for delay and cost arising from regulatory change, together with conditions precedent, time-bar and notice regimes that dovetail with change-in-law mechanisms under FIDIC.

Commodity associations such as OPEC and intergovernmental platforms like the Gas Exporting Countries Forum (GECF) influence construction contracts indirectly through pricing dynamics and sanctions exposure. The OPEC Statute codifies coordination of members’ export policies, affecting long-term price benchmarks and demand forecasts and, through them, financial models, indexation, and price-adjustment clauses embedded in EPC/EPCM agreements (OPEC, 2021). Questions of sanctions compatibility for payments, equipment, and services have become part of routine drafting in the gas sector; these risks are reflected in current reports on licensing particular energy transactions involving Russian counterparties (Interfax, 2023). Contractually this necessitates robust force-majeure, change-in-law, and sanctions clauses, as well as expanded representations and warranties from suppliers, issuing banks for on-demand bonds, and insurers.

The doctrine of energy security provides a public-law framework that constrains private autonomy. Understood as a State’s capacity to guarantee stable supply and protect critical infrastructure, energy security constitutes an autonomous legal interest that limits the parties’ freedom of contract: routing choices, physical-security standards, reliability of supply and import-substitution policies become regulated matters (Shestopalov, 2012). For construction forms this implies tighter licensing and permitting filters, contractual Business Continuity Plans, stress-testing protocols, and express duties to disclose to competent authorities.

Nuclear-energy agreements—specifically the Paris Convention of 1960 and the Vienna Convention of 1963 on civil liability for nuclear damage—form a distinct layer. These treaties set imperative frameworks for liability allocation, caps and insurance coverage, directly shaping contractual undertakings during NPP construction: they require broadened insurance obligations, periodic safety audits, nuclear-materials management, and emergency-response protocols. Legally, part of the risk is shifted beyond party autonomy into the realm of States’ international obligations, thereby delimiting the permissible scope of FIDIC Particular Conditions and calibrating the content of performance securities.

Research on cross-border resource development in the Arctic shows how inter-State agreements on delimitation, unitisation and joint development are transformed into private-law obligations via equity-split formulas, coordination committees and joint operators; Russian–Norwegian practice is instructive (Vylegzhanin, Salygin, & Krymskaya, 2020). For contractors this entails stringent supply-chain compliance, common standards of technical documentation, and acceptance of applicable law and forum clauses anchored in intergovernmental agreements—which take priority over otherwise dispositive contract provisions.

Geopolitical shocks and unilateral restrictive measures affect timelines and costs of energy construction projects, requiring perimeter planning for legal protection at the pre-contract stage. The slowdown and ensuing developments around Nord Stream 2, analysed in the legal literature in connection with sanctions regimes, are illustrative (Kritskiy, 2017). Following the September 2022 sabotage that physically destroyed strings of Nord Stream and Nord Stream 2, questions arose over force-majeure allocation, insurance coverage, evidentiary standards and subrogation among contractors, operators and insurers. Drafting responses include enhanced survey and monitoring duties, cyber- and physical-security obligations, stratification of risks by insurability, and clear triggers for time and price adjustment in events of international tension.

Agreements within the EAEU and other regional frameworks embed specialised dispute-resolution procedures applicable to cross-border grids and trunk infrastructure; their effectiveness is echoed in analyses of the Russian–Norwegian unitisation model (Fodchenko, 2018). A general trend favours tiered mechanisms—negotiation, independent expert determination, Dispute Avoidance/Adjudication Board (DAAB), then arbitration. In energy construction contracts this is reflected in mandatory DAAB provisions under FIDIC and good-faith performance of pre-arbitral steps.

International energy agreements reshape national law by prompting States to adopt acts that raise safety and sustainability standards for energy facilities. Russian doctrine underscores the need to align such domestic novelties with international commitments as a component of reinforcing energy security (Lisitsyn-Svetlanov, 2021). This recalibrates project and construction regulations and creates normative anchors for contracts: mandatory standards lists (GOST, SP, ISO), expanded Employer’s Requirements, and independent technical supervision and compliance audits.

The economic dimension of these agreements manifests through price and investment incentives. Long-term gas arrangements between Russia and EU States and support regimes for renewables—subsidies and tax preferences grounded in intergovernmental deals—are embedded in contract financial models, defining EPC price parameters, payment schedules, KPIs, and bonus-malus schemes (Gudkov, 2016; Romanova, 2015, 2016).

A systemic doctrinal assessment confirms multi-level norm-creation. Studies of international energy relations emphasise the complex constellation of actors and the need for clear allocation of rights and duties and effective dispute-resolution mechanisms (Bogonenko, 2017). For international construction contract law three operational conclusions follow. First, investors should enjoy access to investment-protection fora in addition to commercial arbitration. Second, sanctions, environmental and technology regimes must be embedded in the risk matrix as autonomous grounds for time and cost adjustments. Third, performance security—on-demand bonds, CAR/EAR and business-interruption covers, and political-risk insurance—must be aligned with applicable public-law constraints.

Future development of international energy law—and its projection onto construction contracts—will be shaped by the unification of “green” construction standards and renewables, as well as full-lifecycle digitalisation. Scholarship confirms that politico-legal factors in the Russia–EU energy dialogue continue to affect joint projects (Gudkov, 2014), and hence contract structures, permitting, and risk allocation. Strategically, it is advisable to promote unified infrastructure standard forms under BRICS or the UN, building on the successful practice of FIDIC forms while adapting to regional public-law requirements. The core should include an ICSID path where a dispute features investment elements (with reference to the “investment” criteria applied in Salini), while preserving ICC (or equivalent) arbitration for purely commercial disagreements (Salini Costruttori S.p.A. and Italstrade S.p.A. v. Kingdom of Morocco [I], 2001).

In aggregate, international energy agreements delineate the boundaries and vectors of contractual autonomy in energy construction. They codify access, transit, liability and dispute-resolution rules; shape price and technology frames; and channel public support and insurance solutions. FIDIC-based forms, localised to reflect public regimes—from nuclear liability to sanctions clauses—provide the needed predictability. Further progress will depend on intergovernmental unification, digital standards for information management, and reinforced multi-layer mechanisms to protect the rights of participants in energy projects.

International humanitarian law (IHL) is a key mechanism designed to ensure the protection of war victims, including civilian populations. In armed conflicts, civilians often find themselves in situations where their homes are destroyed and they are forced to seek new shelter. Compliance with IHL norms becomes especially critical when it comes to guaranteeing safe refuge for those who suffer from the effects of military actions. However, modern conflicts require not only the provision of humanitarian aid but also the creation of a clear legal framework for the rapid organization of construction of temporary or permanent housing for refugees. In this context, international construction contract law (ICCL) plays an important role, as it can regulate the legal and organizational aspects of construction projects aimed at restoring destroyed housing and creating new residential facilities for displaced persons. Of particular note are the standards established by the International Federation of Consulting Engineers (FIDIC) and the building regulations of various countries, which make the legal regulation multifaceted and complicate its adaptability in the framework of protecting war victims and systematizing their rights to safe and adequate housing.

Within IHL, a distinction is often made between two key components – the ‘Hague Law’ and the ‘Geneva Law’. Hague Law, as formalized in the Hague Conventions of 1899 and 1907, regulates the methods of conducting warfare and the behavior of armed forces, whereas the Geneva Conventions are aimed at protecting those harmed by military actions, including civilians and prisoners of war. The adoption of the Additional Protocols to the Geneva Conventions has expanded the regulatory areas traditionally belonging to Hague Law, reducing the significance of this distinction in the modern practice of armed conflict regulation (Avakyan, 2022).

However, in modern armed conflicts such as military operations in Syria or Iraq, the problems of protecting civilians and refugees go beyond merely complying with IHL norms. The need for the rapid provision of housing and infrastructure requires the development of comprehensive legal mechanisms that address both safety standards compliance and the swift completion of construction projects. ICCL plays a key role in this context by providing tools to draft contracts capable of flexibly responding to emergencies. For example, the use of FIDIC standard contracts provides mechanisms for dispute resolution and for adapting contractual obligations in force majeure situations such as armed conflicts and natural disasters. This makes it possible to carry out housing construction projects even under crisis conditions, which is extremely important for the protection of refugees and victims. The application of such flexible legal mechanisms thus contributes not only to the completion of construction projects but also to the prevention of legal conflicts associated with delays and contractual non-performance in crisis situations (Goodwin-Gill et al., 2021).

This study is based on an analysis of the legal norms of IHL and their application in the context of ICCL. The main focus is on the Geneva Conventions, the standard forms of construction contracts developed by FIDIC, and their integration into the processes of restoring destroyed housing and creating temporary accommodations for refugees. The study covers the regulatory framework for construction projects in zones of armed conflict, with an emphasis on enforcement practices and compliance with international and national safety standards. A significant portion of the work is devoted to examining real case studies of humanitarian operations, including those under the auspices of the UN and other international organizations, with the aim of identifying the key legal mechanisms that ensure the protection of war victims in the context of construction and infrastructure restoration. This allows for the development of approaches to integrate international obligations into concrete projects that provide housing and infrastructure for those affected by armed conflicts.

Customary international law (CIL) plays a key role in providing legal protection to war victims, especially in situations where individual states have not ratified major international treaties. This is particularly relevant in internal armed conflicts, where the absence of legally binding norms can lead to serious gaps in the protection of civilian rights. The legal framework formed by CIL bridges these gaps through its universality. States, international organizations, or other recognized international actors endowed with legal personality can not only participate in the lawmaking process but also serve as the main bearers of the rights and obligations established by these norms. They play a crucial role in creating legal mechanisms to protect war victims by introducing standards that ensure resilient legal protection on the international stage (Kuzmin, 2022).

Despite the significance of customary international law as a protection instrument in armed conflicts, its limitations should be taken into account. Unlike treaty law, customary law does not always contain clear, formalized rules readily available for direct application. This creates certain difficulties for legal practitioners, since the content of such norms is often more abstract and less detailed than treaty obligations, which can complicate their interpretation and implementation in specific legal situations. Moreover, customary international law, being unwritten in nature, often requires additional efforts to establish the precise content of norms applicable in particular cases. In this connection, the work of the International Committee of the Red Cross (ICRC) is of special relevance; the ICRC conducted a comprehensive study aimed at codifying customary norms of IHL. As a result of this project, 161 rules were identified that are recognized as customary international law and can be used by practitioners for the protection of war victims and conflict victims (Guliyev, 2022). This ICRC project constitutes an important resource for lawyers and international law specialists working in the field of humanitarian law, as it contributes to the refinement and systematization of norms applicable in various armed conflict contexts, making their practical application easier.

The sources of IHL can be classified into two main categories, each of which has significant importance for the execution of construction projects in armed conflict zones: conventional sources and non-conventional sources. Conventional sources of IHL are international treaties, such as the Geneva Conventions, which form the basis for regulating the rights and obligations of parties in armed conflicts. These treaties establish detailed legal rules governing the protection of civilians, the wounded and sick, prisoners of war, and other vulnerable groups. The Geneva Conventions retain central importance in international law because they regulate aspects related to the observance of rights and safety in combat zones. These norms form the legal basis for restoring destroyed infrastructure, including the provision of temporary shelter for refugees, provided that such projects comply with IHL requirements and safety building standards.

Non-conventional sources—auxiliary legal norms such as international customary law, general principles of law, and resolutions of international organizations—complement the conventional norms. Although these non-conventional norms have less formal legal force, their practical significance is particularly evident in situations where international treaties cannot be applied. They provide an additional legal foundation for adherence to safety standards and the protection of conflict victims, especially when construction projects must be implemented urgently in conditions requiring the immediate application of IHL norms. These sources expand the possibilities for legal protection by allowing safety standards to be adapted to the specifics of conflict zones.

States: States are the primary actors responsible for ensuring observance and implementation of IHL provisions in conflict zones, including areas of construction. Their duties include securing construction projects, protecting the personnel involved in rebuilding infrastructure, and upholding the rights of conflict victims. This is especially critical for the prompt deployment of humanitarian facilities in crises.

Armed Non-State Groups: Armed groups not under state authority, such as insurgent formations, are also obliged to comply with IHL norms, including those concerning the protection of civilian populations and infrastructure. This is important in the context of construction projects, which are often at risk in areas where such groups operate. International practice increasingly holds these groups accountable for adherence to IHL norms, especially when their actions create threats to humanitarian construction projects.

Private Individuals and Contractors: Private individuals, including civilian contractors and personnel participating in construction projects, must also observe IHL norms to ensure the protection of conflict victims. Involvement of private parties in construction in conflict zones requires adherence to international safety standards and compliance with all IHL requirements to minimize risks and ensure adequate protection for those participating in the projects.

In modern international law, defining the temporal scope of IHL has become complex, especially in situations where armed conflicts transform from one type to another. As has been noted in the literature (Lazutin, 2022), processes of internationalization and internalization of conflicts significantly affect the legal regime and the range of applicable norms. The transition of a non-international armed conflict into an international one results in expanded guarantees for combatants and civilian populations, directly impacting how housing construction for refugees is organized and regulated in the conflict area. Therefore, understanding the temporal aspects of IHL’s application is crucial for all participants in international construction projects in conflict zones. Uncertainty about which legal norms apply can lead to legal conflicts and complicate the process of providing assistance to war victims. Integrating an analysis of IHL’s temporal boundaries into ICCL practice helps increase the effectiveness of humanitarian operations and provides additional protection of the rights of affected persons, taking into account the duration of construction projects.

Humans, as the central subjects of IHL in armed conflicts, play a key role in law enforcement processes. This includes various categories involved in conflicts: combatants, the wounded and sick, civilians, personnel of international organizations, foreigners, refugees, internally displaced persons, stateless persons, dual nationals, mercenaries, spies, and others. All of them fall under the protection of IHL norms, which is particularly relevant in modern conflicts that often affect civilian infrastructure, including international construction projects.

However, despite the central importance of the individual in the IHL system, a person does not possess full international legal personality. While individuals have certain elements of legal capacity under international law — which grant them specific rights and obligations on the international stage — their capacity remains limited. Nevertheless, individuals have international legal capacity and delictual capacity, which obligates the observance of their rights and duties under IHL (Avakyan, 2022). This limited legal personality creates additional legal complexities when forming conditions for international construction contracts: it is necessary to balance protecting those suffering from armed conflict with the interests of construction project participants, whose investments in such conflicts may be significantly at risk.

ICCL and enforcement practices face the need to take into account the limited legal personality of individuals in conflicts, which requires holding not only states but also non-state actors accountable when their actions may affect compliance with IHL norms. This is particularly important in situations where construction projects intended to provide safe housing and infrastructure restoration are implemented in armed conflict conditions.

In modern international relations, the humanitarian agenda remains extremely significant. Despite global trends toward reducing violence, as has been argued in the literature (Pinker, 2021), armed conflicts continue to have a devastating impact on civilian infrastructure. These conflicts threaten construction and humanitarian projects that are essential for the recovery of affected regions. In this regard, the role of IHL and ICCL is particularly large, as they establish legal mechanisms for the protection of the civilian population and infrastructure even in crisis conditions.

Apart from the social threats associated with armed conflicts, construction projects and humanitarian operations face significant physical risks posed by natural processes and geographical factors, such as earthquakes, floods, and biological threats (including epidemics and pandemics caused by viral and bacterial diseases). The COVID-19 pandemic vividly demonstrated how biological threats can complicate the execution of construction projects and humanitarian operations, increasing risks for all participants (Glaser & Novik, 2020).

Situations where physical threats coincide with those related to armed conflicts present particular complexity. For example, in conditions of active hostilities, it may be necessary to urgently build specialized hospitals to combat an epidemic, or an armed conflict may break out in an area already facing a biological threat. Such overlapping crises require flexibility and resilience in approaches to construction and contract execution in order to timely provide the necessary infrastructure facilities to protect civilians and workers.

These circumstances create a need for the development and enhancement of humanitarian diplomacy and aid instruments, which is especially important in the context of ICCL. The establishment of legal mechanisms to protect conflict victims, as well as the strengthening of cooperation between states and international organizations in this domain, plays a decisive role in minimizing the negative impacts of armed confrontations and natural catastrophes on the implementation of construction projects in conflict and post-conflict zones.

The intensification of humanitarian activity in modern armed conflicts necessitates deeper theoretical understanding of ongoing processes. However, this task is complicated by two main factors. First, despite the widespread practice of providing humanitarian assistance and the adoption of international commitments by many state and non-state actors, there still is no single agreed understanding of the key concepts in the humanitarian sphere. For example, the term “humanitarian diplomacy” (HD) only entered academic discourse in the early 2000s during the emergence of new diplomatic directions. The challenges of categorizing and analyzing this phenomenon are reflected in studies such as the work of D. M. Kovba (Kovba, 2020). Second, despite growing interest in this topic, the first significant monograph dedicated to humanitarian diplomacy was published only in 2007 (Caballero-Anthony, 2018), underscoring the relatively recent institutionalization of this field in international relations.

Furthermore, there is a continuous complication of the humanitarian landscape, which directly influences the implementation of major international construction projects, especially infrastructure projects spanning multiple countries, given persistent armed conflicts in the Middle East and post-Soviet space. Unlike traditional forms of diplomacy, modern humanitarian initiatives are no longer limited to interactions solely between states. Multilateral formats are increasingly used, involving not only state actors but also non-state actors, reflecting the multifunctional and networked nature of modern diplomacy. As has been noted in scholarship (Clark, 2018), contemporary humanitarian diplomacy is characterized as “multi-functional” and “networked,” emphasizing its flexibility and ability to adapt to varying conditions. The humanitarian diplomacy process increasingly involves media representatives, commercial entities, and private individuals.

One notable work addressing current problems of protecting victims of armed conflicts through the lens of international law is the monograph by E. S. Gromoglasova, Humanitarian Diplomacy in Modern International Relations: Experience of a Systematic Study (Gromoglasova, 2018). This study examines humanitarian security issues in detail, with special emphasis on practices of the European Union aimed at protecting civilian rights in conflict situations. These practices serve as examples for integrating humanitarian mechanisms into the framework of ICCL, thereby creating legal instruments for protecting the interests of civilians and participants in construction projects operating in conflict zones.

Humanitarian cooperation among the BRICS countries represents an important aspect of international legal coordination in this field. In particular, paragraph 66 of the 2018 Johannesburg BRICS Summit Declaration emphasizes the importance of sustainable infrastructure development and integration in post-conflict zones, including in Africa, through programs such as the New Partnership for Africa’s Development (NEPAD) and the Program for Infrastructure Development in Africa (PIDA). This support underscores the necessity of investing in projects that can ensure stable recovery after armed conflicts and provide infrastructure to improve the living conditions of the civilian population. Integrating humanitarian norms into international construction contracts thus becomes a key step toward creating resilient legal frameworks aimed at protecting war victims and preventing future humanitarian crises during the reconstruction process.

In the context of ICCL, cooperation between humanitarian organizations and construction project participants in crisis zones remains crucial. Organizations like Médecins Sans Frontières (MSF) play a critical role in providing humanitarian aid to war victims by delivering medical assistance and support under conditions where basic infrastructure may be destroyed. Although their activities are not directly linked to the execution of construction projects, such organizations highlight that in rebuilding infrastructure in conflict zones it is necessary to consider humanitarian standards and requirements aimed at ensuring safety and access to vital resources for the affected population. The successful integration of humanitarian norms and legal standards into the reconstruction process helps reduce humanitarian risks and ensures respect for the rights of conflict victims, forming part of a comprehensive approach to post-war recovery.

States actively apply mechanisms of humanitarian diplomacy to protect the rights of conflict victims. One example is the construction of a temporary floating pier off the coast of the Gaza Strip, completed in 2024, which provided a key aid point for delivering humanitarian assistance to the region suffering from the consequences of conflict (Financial Times, 2024). This project helped accelerate the delivery of food and medicine, illustrating the importance of integrating international humanitarian norms into infrastructure projects in crisis zones. It underscores the necessity of cooperation among states, international organizations, and local structures in implementing construction initiatives aimed at the restoration and support of affected regions.

The practical experience of the UN High Commissioner for Refugees (UNHCR) underscores the importance of strict compliance with international construction standards when erecting temporary housing for persons affected by armed conflicts. UNHCR’s approaches to providing emergency shelter – including standards developed specifically for emergency situations – demonstrate the close interrelation between IHL and construction contracts (UNHCR, n.d.).

In recent conflicts such as those in Syria and Yemen, ensuring temporary housing for refugees and internally displaced persons (IDPs) involves complex legal, technical, and organizational challenges. A key task is to comply with international humanitarian norms and standards while integrating local building codes and regulations. This imposes additional difficulties and complicates the construction of temporary shelters. In such conditions, ICCL can provide instruments to address these challenges, as demonstrated by general approaches to the legal regulation of migration and its interaction with external control mechanisms analyzed by authors like Cantor et al. (Cantor et al., 2022). Cantor’s research examines externalization processes in migration and the legal aspects of managing these processes, which can be applied to the broader field of international law and humanitarian operations (Cantor et al., 2022).

Modern legal norms governing the status and rights of refugees highlight the importance of providing housing for this vulnerable group. According to UN principles and the recommendations of the ICRC, providing individual housing to conflict victims is crucial, as it helps strengthen their security and psychological resilience. Implementing these standards faces many challenges, including the need to consider local building codes, as well as climatic and cultural specifics. This requires flexible adaptation of international standards to the conditions of particular regions. The standard FIDIC contract forms, widely used in international construction projects, provide effective mechanisms for dispute resolution and management of construction processes in emergency situations, including armed conflicts.

A significant contribution to the study of ICCL is the work by L. Klee, International Construction Contract Law (Klee, 2018), where the author provides a detailed analysis of the key principles and mechanisms applicable to construction projects implemented under crisis and conflict conditions. Klee highlights the importance of standardizing contract terms such as those provided by FIDIC, which enable flexible adaptation of the parties’ obligations under force majeure conditions (Klee, 2018). This is especially relevant in the context of rapid crisis response and the protection of war victims. One of the key features of FIDIC contracts is their capacity to ensure the swift construction of temporary facilities, such as refugee camps, while meeting minimum safety and structural stability standards. These mechanisms allow construction processes to be adapted to emergency conditions, providing a prompt response to the needs of refugees. However, despite the flexibility inherent in FIDIC contracts, the practical question often arises of how to balance the speed of erecting temporary housing with compliance with building codes in crisis situations.

An example of the successful application of FIDIC standards is seen in projects in the Democratic Republic of the Congo, where, despite ongoing hostilities, refugee camps were constructed while ensuring compliance with basic safety and stability standards for temporary structures. This experience highlights the importance of applying comprehensive international contract standards such as FIDIC to guarantee the right to housing in emergency situations (Dowd & McAdam, 2017). Often temporary solutions must be used, such as tent cities or prefabricated structures. However, as UNHCR research has shown (UNHCR, n.d.), such structures often fail to meet long-term needs, especially in extreme climatic conditions. Temporary solutions, like using plastic sheeting, frequently do not meet sustainability requirements, which exacerbates the problem and necessitates the use of higher-quality, more durable materials adapted to local conditions. In these circumstances, a number of additional factors need to be considered, including limited access to construction materials, complex security conditions for workers, and environmental protection. Using local construction resources and traditional methods can not only reduce costs but also increase the speed of construction work, which is critically important in humanitarian crises.

International construction contract law, particularly the standards and procedures developed by FIDIC, represents reliable tools for managing construction projects under crisis conditions. These mechanisms can be successfully used to create temporary and permanent housing for victims of armed conflicts, making them key to addressing humanitarian challenges. However, the effective implementation of such projects requires consideration of the unique features of each conflict zone, including resource availability, climatic and cultural factors, and compliance with international humanitarian norms. The central task becomes the adaptation of international standards to local conditions, which minimizes costs and accelerates housing construction while maintaining high safety standards.

Global cooperation and the distribution of responsibility among states become particularly significant in the context of crises involving population displacements. As has been highlighted in the literature (Dowd & McAdam, 2017), despite the importance of state obligations to protect refugees, the absence of a systemic, predictable, and equitable mechanism for sharing responsibility remains a pressing problem. This places additional burdens on states, especially in situations of large-scale displacement and crises. Dowd and McAdam’s study demonstrates that effective responsibility-sharing is possible only through joint efforts of the international community aimed at financial and technical support for host countries, as well as the creation of sustainable resettlement mechanisms for refugees. This underscores the importance of a comprehensive approach to humanitarian and construction projects designed to ensure the protection of the rights and interests of refugees.

Based on this study, the following conclusions can be drawn: ICCL plays a significant role in protecting victims of armed conflicts, particularly in ensuring temporary and permanent housing for refugees and internally displaced persons. The examination of international and national legal norms, including standards developed by FIDIC, helps to understand how these norms influence the execution of construction projects in crisis and post-conflict zones. It was found that integrating international obligations with local regulations is accompanied by a number of challenges that require careful attention.

The purpose of the research was to examine the possibilities of applying ICCL legal tools to protect victims of conflicts. Through this analysis, key legal mechanisms were identified that can facilitate the effective implementation of construction projects under crisis conditions, and issues of adapting contractual obligations in emergency situations were also considered.

The findings emphasize the importance of improving international legal mechanisms to protect war victims through a broader use of ICCL. Particular attention should be paid to coordinating efforts between states, international organizations, and other actors to develop comprehensive legal solutions. Further development and adaptation of international standards governing the execution of construction contracts in crisis conditions can contribute to enhanced legal protection of the affected and more effective restoration of destroyed infrastructure.

The construction sector’s globalization has exposed large infrastructure projects to complex transnational criminal threats, particularly corruption. When multinational contractors, host-state officials, and international financiers converge on cross-border projects, opportunities for bribery and illicit collusion multiply. These corrupt practices undermine the rule of law at every stage – from tendering to dispute resolution. As noted by Klebanov, the transnational nature of modern crime demands special enforcement approaches balancing individual and state interests under strict legal guarantees. In the context of construction contracts, unchecked corruption can infect entire transactions. Experience shows that “[p]roven corruption routinely voids international construction contracts and eliminates investment protection,” reflecting a global mens rea zero-tolerance for bribery.

Under current international law, frameworks like UN conventions, OECD guidelines, and Council of Europe treaties – alongside model contracts of the International Federation of Consulting Engineers (FIDIC) – offer some anti-corruption tools. Yet in practice these mechanisms often fail to deter bribery effectively. Inogamova-Khegai highlights that international criminal law still lacks codified provisions targeting many forms of corrupt conduct, leading to inconsistent enforcement. This gap is felt acutely when trying to hold wrongdoers to account across jurisdictions. Our hypothesis is that integrating criminal-law norms into international construction contracts will more effectively reduce corruption risk in infrastructure projects. Strengthening corruption-related provisions and empowering enforcement (at both national and international levels) can create a stronger deterrent effect.

Historical development. The evolution of modern international criminal law has steadily incorporated anti-corruption aims. As early as 1947, Russian jurist M. D. Shargorodsky identified international criminal law as a distinct branch of public law aimed at coordinating states’ efforts against numerous crime forms. By the late 20th century, scholars such as Dinstein (1985) and Bassiouni (1997) emphasized the need for uniform global instruments to prosecute offenses threatening international order. Notably, Lukashuk and Naumov (1999) viewed international criminal law as an evolving cornerstone of world order, requiring constant treaty updates and stronger institutions. This doctrinal progress paralleled the rise of soft-law anti-corruption standards within the UN system. Habrieva (2017) stresses that “soft” instruments (resolutions, programs, principles) laid the groundwork for later binding conventions against corruption. By the early 21st century, international commentators like Ivanov (2016) and Panov (2018) called for unified legal frameworks and inter-state cooperation to fight corruption in large-scale projects.

Case studies in investment disputes. A number of landmark arbitral cases in the 2000s illuminate how corruption intersects with international construction contracts:

• World Duty Free Co. Ltd. v. Republic of Kenya (ICSID Case No. ARB/00/7, Award Oct. 4, 2006). In this seminal case, a British firm contracted to build duty-free shops at Kenyan airports. Only in arbitration did evidence emerge that the contract (1989 Agreement) had been secured by a $2 million bribe paid to President Daniel arap Moi. Upon confirming the bribe payment, the ICSID Tribunal held that the Claimant had procured the agreement through corruption and thus had no right to claim any remedies. It denied all of World Duty Free’s claims on public policy grounds, citing the maxim ex turpi causa non oritur actio. This was a watershed: it explicitly established that corruptly-obtained contracts are unenforceable in investment arbitration.

• Siemens A.G. v. Republic of Argentina (ICSID Case No. ARB/02/8, Award Jan. 17, 2007). Siemens won a large contract in the 1990s to build Argentina’s national ID system, later claiming $217 million for expropriation when the contract was terminated. After the arbitration award, however, investigations in Germany and the U.S. (pursuant to the FCPA) revealed widespread bribery by Siemens, including of Argentine officials. Siemens ultimately admitted to paying bribes to secure the contract and entered into settlement agreements. Argentina reopened the case, but the parties eventually agreed on a post-award settlement, and Siemens relinquished its claims. The Siemens saga illustrates how criminal enforcement can intersect with investment arbitration: the ICSID tribunal did not address corruption during the arbitration, but subsequent criminal prosecutions effectively nullified the investor’s gains. The Siemens case also had broader impact: as the SEC press release notes, Siemens “paid bribes… to obtain … national identity cards in Argentina”, leading to huge fines. After Siemens, arbitration tribunals became more receptive to corruption defenses, and states more willing to invoke them.

• Metal-Tech Ltd. v. Republic of Uzbekistan (ICSID Case No. ARB/10/3, Award Oct. 4, 2013). An Israeli company formed a joint venture with Uzbek state firms to build a molybdenum plant. The arbitration tribunal found that Metal-Tech had paid roughly $4 million to multiple “consultants” – including relatives of high-level Uzbek officials – in purported kickbacks. Concluding these payments violated Uzbek anti-bribery law, the tribunal held it lacked jurisdiction: the investment was not “legal” under the Uzbekistan-Israel BIT’s own definitions. In essence, Metal-Tech’s corruption meant the tribunal refused to protect the investment, which was deemed non-compliant with both Uzbek and international public policy. The case is notable for its evidentiary approach: the tribunal considered “red flags” (the payment size, lack of real services, political ties of recipients) as sufficient indicia of corruption. Metal-Tech thus confirmed that tribunals will deny protection to “tainted” investments – and that substantial indirect evidence can suffice to establish corruption.

• Inceysa Vallisoletana S.L. v. Republic of El Salvador (ICSID Case No. ARB/03/26, Award Aug. 2, 2006). Inceysa, a Spanish firm, won a Salvadoran contract for a vehicle inspection project. The contract was later annulled amid allegations that Inceysa had used fraudulent documents and collusion to win the tender. Although direct bribery by Inceysa was not proven, the tribunal held that Inceysa’s own fraudulent conduct violated the “legality” principle. By applying the clean hands doctrine (nemo auditur propriam turpitudinem allegans), the tribunal denied Inceysa any remedy. This was one of the first cases (preceding Metal-Tech) where an investor was denied ICSID protection on corruption grounds. Importantly, Inceysa established that not only classical bribes but also other illicit means (fraud, collusion) can strip an investment of protection if they render the contract itself unlawful in purpose. For construction contracts, Inceysa underscores that dishonest bidding taints the resulting contract, precluding protection in case of dispute.

• EDF (Services) Ltd. v. Romania (ICSID Case No. ARB/05/13, Award July 8, 2009). In a twist, British company EDF claimed Romania expropriated its contracts for duty-free shops in Bucharest airports. EDF responded to Romania’s non-renewal of leases by alleging that a Romanian official had solicited a $2.5 million bribe for contract extensions. Here corruption was alleged against the state. The tribunal found this contextically interesting but ultimately rejected EDF’s claims on evidentiary grounds. It reaffirmed the high burden for corruption allegations: accusations must be supported by “clear and convincing evidence”. In EDF, the evidence (a purported tape recording and witness hearsay) fell short, and the tribunal refused to award damages. The EDF decision clarifies that even when an investor accuses a state of corruption, the tribunal maintains a stringent standard of proof. This struck a balance in the system: while corruption is taken seriously, the parties (state or investor) must convincingly establish it.

• Spentex Netherlands B.V. v. Republic of Uzbekistan (ICSID Case No. ARB/13/26, Award Feb. 29, 2016). Spentex, a Dutch firm, privatized Uzbek textile assets. After an adverse arbitration outcome, Uzbekistan alleged Spentex obtained the assets through corruption: a $6 million “commission” promised before the privatization. The tribunal determined that, even without naming specific officials, the totality of the “red flags” confirmed corruption – the pre-auction $6m transfer, lack of economic justification, and immediate halting of payments once assets were secured. Finding corruption, it refused to protect the investment. Significantly, Spentex is known for the tribunal’s unusual remedy: recognizing that the State also bore corruption risk, the panel “strongly recommended” Uzbekistan donate $8 million to a UN anti-corruption fund. This marked an embryonic form of “restorative justice” in investment law – punishing both private and public contributors to the corrupt bargain. The case reinforces the doctrine of absolute legality of investment: if serious bribery is found (even without a confession of officials), the investor loses protection, and possibly so does the state.

• MOL Hungarian Oil & Gas Co. v. Republic of Croatia (ICSID Case No. ARB/13/32, Award Dec. 23, 2016). Croatia accused MOL of securing control over national oil firm INA via a €10 million bribe to former Prime Minister Ivo Sanader. Notably, Sanader himself was later convicted in Croatia for taking a bribe from MOL. The UNCITRAL arbitral tribunal (PCA, 2016) scrupulously reviewed evidence including Sanader’s testimony and related documents. In the end, the tribunal declined Croatia’s claims: it found Croatia failed to prove MOL’s liability beyond a reasonable doubt. Even though the national court had convicted Sanader, the international tribunal required explicit proof tying MOL to the bribe (such as signed documents, bank transfers, or witness admissions). Finding none, it ruled in MOL’s favor. MOL v. Croatia illustrates a key point: national criminal judgments against officials do not automatically bind arbitration panels. States must independently prove the investor’s guilt in the arbitral forum. From a construction-contract perspective, MOL shows that unambiguous evidence is required to unwind an investment – the tribunal effectively prioritized the autonomy of its fact-finding over parallel domestic verdicts.

• Process & Industrial Developments (P&ID) Ltd. v. Federal Republic of Nigeria (English Commercial Court, 2023). Although this case arose in a private (arbitration-then-court) context, its lessons are germane. P&ID (a JV registered in the Virgin Islands) entered a gas-processing contract with Nigeria. In 2017 it won an ad hoc international arbitration in London – roughly $6 billion award. Subsequently, Nigeria uncovered that the P&ID contract had been fraudulently procured via a scheme involving payments to Nigerian officials and collusion with local politicians and lawyers. Nigerian courts convicted P&ID agents for fraud and bribery, freezing its assets. In 2023 the English Court of Appeal (High Court) annulled the arbitral award, finding it procured by “wholly dishonestly” presenting false evidence and concealing bribes. Lord Justice Leggatt described P&ID as an “egregious” abuse of process demanding correction. The P&ID saga powerfully confirms that even mature arbitration awards can be voided if corruption is later proven. It underscores that investment arbitration is not infallible: national courts (here in London) will intervene when justice requires. The case also had broader impact, spurring calls for greater scrutiny of arbitration evidence and international cooperation: Nigeria obtained mutual legal assistance (warrants, witness interviews) with the U.S. and U.K. to build its case, demonstrating that effective cross-border enforcement requires intergovernmental effort.

• Lesotho Highlands Water Project corruption prosecutions (Lesotho, 2002–2004). In an example outside arbitration, Lesotho prosecuted corruption in a major infrastructure project. LHWP was a transnational dam and water-transfer scheme financed by multiple governments. In the late 1990s, officials discovered that executives of major foreign contractor consortia (from Canada, Germany, etc.) had bribed Lesotho’s project administrator, Masupha Sole, to win contracts. The High Court of Lesotho (2002–2003) convicted Sole (15 years) and two companies (Acres, Lahmeyer) for international bribery. This was one of the first times a developing country successfully jailed foreign companies and officials over project corruption. Lesotho’s actions enforced the principle that “both sides of the bribe are punished” – not only Sole, but also the paying corporations received heavy fines. The World Bank responded by “debarment” of those companies, signaling international solidarity against corruption. While arbitration and criminal proceedings operated separately (companies unsuccessfully tried to assert arbitration clauses), the LHWP case shows the power of national criminal law to set an example in international contract law. It also raises the question of prevention vs. cure: would robust anti-corruption measures at the tender stage have been more efficient than later convictions?

Analysis and conclusions. The systematic review of case law reveals clear patterns:

1. Corruption nullifies protection. In the leading cases (WDF, Metal-Tech, Inceysa, Spentex, etc.), once bribery or fraudulent collusion by the investor was proven, tribunals refused to enforce the contracts or treaties. By invoking international public policy and the “clean hands” doctrine, arbitrators consistently held that illicitly-concluded contracts confer no rights. This effectively “resets” the legal protection: investors lose claims, and contracts are void for purposes of relief. As one commentator observes, Metal-Tech’s decision was “strike two” against corrupt claimants (after World Duty Free), promoting the rule of law over corrupt deals.

2. Evidence matters. States have broadened use of corruption defences, but actual outcomes hinge on evidence quality. If a state (or investor) alleges corruption without firm proof (see EDF v. Romania, MOL v. Croatia), tribunals dismiss the allegations. Arbitrators insist on high evidentiary standards – often “clear and convincing evidence” – before voiding a contract. By contrast, when indirect “red flags” are strong and corroborated (as in Metal-Tech, Spentex), tribunals will find corruption even absent a confession. Overall, the jurisprudence has coalesced around the idea that proven corruption is excludable from protection, but unproven accusations gain no traction. The EDF principle (“clear and convincing evidence”) has become an implicit benchmark in arbitration practice.

3. Symmetry of accusations. Investors can also accuse states of corruption (corruption defense), but the system remains balanced. In EDF v. Romania, the investor accused a government of bribery, yet the tribunal required the same evidentiary rigor as if roles were reversed. In practice, an investor’s bribery of a state official (if convincingly proven) can constitute a defence for the state. Meanwhile, an investor wrongly accused faces equal scrutiny. The fair outcome is that both parties must substantiate any corruption allegations with credible evidence. Neither side enjoys a presumptive advantage in these accusations.

4. Parallel systems diverge. National criminal verdicts and international arbitration can reach different conclusions. MOL v. Croatia starkly illustrates this: Croatia’s judiciary convicted its former PM for taking a bribe from MOL, yet the ICSID tribunal in London acquitted MOL due to insufficient proof of a corporate bribe. This discrepancy arises because arbitral tribunals are not bound by national courts’ findings. As a result, alignment between criminal justice and investment arbitration remains an open issue – although P&ID shows that domestic courts may later override arbitral awards to vindicate justice. The tension highlights the need for better mechanisms to integrate results of criminal prosecutions (e.g. through admissibility of domestic findings) into arbitral fact-finding, while respecting due process.

5. Role of prosecution. Criminal prosecutions can reinforce anti-corruption norms, albeit retrospectively. Cases like Lesotho’s LHWP prosecutions demonstrate how domestic law enforcement deters both private and public actors from corruption. When courts impose penalties on both bribe-takers and bribe-givers, they bolster confidence in legal frameworks. As international bodies have noted, robust prosecutions and sanctions serve as a powerful dissuasive. Moreover, when project financiers (e.g. multilateral banks) and states cooperate on enforcement and debarment, they create industry-wide “clear signals” against corruption. However, reliance on post-facto prosecutions is limited: it can only punish after the damage. Thus, while valuable, criminal justice must complement preventative contractual safeguards.

6. Institutional convergence. There is a clear trend toward greater integration of criminal-law standards into investment practice. The corollary doctrine of “corruption defense” is now an implied requirement in the investor-state regime. Leading jurists argue for future reforms, such as allowing corruption facts to be considered at the merits stage (not only jurisdiction), and allocating responsibility proportionally in mixed-liability cases. The notion that treaties and contracts should explicitly require compliance with anti-corruption norms (e.g. OECD Guidelines, UNCAC provisions) is gaining acceptance. Ultimately, international criminal justice and investor arbitration are increasingly intertwined in construction contract disputes. Corruption, once a “hidden vice,” is now a standalone risk factor dictating case outcomes. This shift signals a cautious optimism: global infrastructure projects may gradually benefit from stronger rule-of-law safeguards, as long as enforcement transcends borders.

In sum, combating corruption in international construction contracts calls for systemic change. Effective measures include universal anti-corruption standards in contract law, mandatory transparency and compliance obligations, enhanced cooperation between international bodies and national law enforcement, and specialized judicial forums for transnational corruption. Confiscatory sanctions on illicit gains (backed by cross-border enforcement) are also essential. Implementing these measures would make large infrastructure projects safer and enhance legal protection for all parties, thereby reinforcing justice and integrity in global construction law.

International construction has developed at the junction of sovereign prerogatives and private autonomy, which is why legal forms of integration display their strengths and weaknesses with particular clarity in this field. In a multipolar environment, regionalisation becomes a practical instrument for streamlining contracting practice whenever universal mechanisms are overloaded or politically sensitive (Prikhodko, 2023). Preserving state sovereignty and protecting national constitutional identity are not optional add-ons but structuring criteria for the institutional design of integration (Nikez et al., 2023).

Experience from the post-Soviet space shows that, even where a common economic objective is proclaimed, the actual construction of a “single space” collides with divergences in legal orders, levels of development and administrative capacity, so that integration norms often operate only fragmentarily (Yaryshev, 2021). In such circumstances, constitutional constraints and filters for implementing international commitments gain salience: for the Russian Federation, Article 15(4) of the Constitution frames the reception of international norms while simultaneously raising issues of legal sovereignty and identity (Kondrashchenko & Kochesokova, 2023).

Within the Eurasian model, the Treaty on the Eurasian Economic Union established a dedicated institutional architecture—complete with a judicial tier, international legal personality and a division of competences—evidencing a search for balance between coordination and supranationality (Treaty on the EAEU, 2014; Sokolova, 2017). Yet parallel bilateral formats (for example, the Union State of Russia and Belarus) frequently siphon norm-making energy away from the EAEU level into narrower platforms, generating centrifugal effects within the overall framework (Sokolova, 2010).

By contrast, European integration illustrates how the stability of the freedom of establishment has been secured not only by convention texts but by the case-law of the Court of Justice. The unratified conventions of the 1960s on recognition of legal persons were partially “replaced” by jurisprudence: Centros (1999) and Überseering (2002) displaced rigid seat theory, ensured genuine corporate mobility and dismantled regulatory barriers to cross-border activity (Lebedev & Kabatova, 2015; Centros, 1999; Überseering, 2002). For construction contracts, this has meant predictable party status, the feasibility of centralised management, and greater uniformity in formal and evidentiary requirements.

The practice of the Shanghai Cooperation Organisation, by contrast, exposes the risks of inert collective mechanisms and a drift toward a web of bilateral arrangements: “slow” cooperation reduces the likelihood of common standards for complex sector-specific contracting (Aliev, 2014). Similar symptoms appear in the EAEU: bilateral coordination in narrow formats tends to be politically and technically faster than multilateral unification, leaving participants with elevated transaction costs in cross-border works (Sokolova, 2017; Sokolova, 2010).

Against this backdrop, private-law unification via standard forms assumes a pivotal role: the FIDIC books have effectively become the operative language of international construction contract law for risk allocation, notice procedures, change management and tiered dispute resolution (FIDIC, 2024). In the EU, their operation is supported by an ecosystem of procurement and contract law; in the EAEU, the same conditions more often require tailored Particular Conditions aligned with mandatory rules and regulatory practice, which increases uncertainty for contractors and investors. This reflects different depths of integration: where EU judicial and regulatory institutions secure uniform interpretation, in the EAEU a larger share of harmonisation is left to the contract layer and to arbitration clauses (Bezborodov & Likhachev, 2023; Treaty on the EAEU, 2014).

The contour of economic public policy is equally decisive. The EU’s growing reliance on autonomous foreign-policy instruments—including restrictive measures and jurisdictional countermeasures—builds protective barriers for the Union while simultaneously creating additional risks for third-country participants (Abdullin & Keshner, 2021). For major construction projects this translates into sanctions clauses, revisions of banking covenants and the rewiring of supply chains to comply with export-control regimes—all of which must be synchronised with the FIDIC contract architecture (notice regimes, time-bars, DAAB routes and arbitration).

In parallel, an alternative integration track proceeds through coordination of discrete blocks of private law. Even ahead of “hard” harmonisation, the BRICS tax vector demonstrates how convergence on specific norms (permanent establishments, anti-avoidance, and double-tax relief) can lower barriers for SMEs—the key suppliers within construction value chains (Vinnitsky & Kurochkin, 2018). This modular approach creates a “soft” legal field onto which sectoral FIDIC standards can subsequently be layered.

A comparison across the EU, the EAEU and the SCO reveals a durable dichotomy: the EU’s positive integration delivers universality of standards and their uniform interpretation; Eurasian formats prioritise flexible coordination and bilateral compromises, complicating predictability. Sector-specific lubrication in the form of FIDIC alleviates part of the cost burden, but without a supranational backstop—or at least stable quasi-judicial convergence—it cannot eliminate all conflicts (Sokolova, 2017; Yaryshev, 2021; Bezborodov & Likhachev, 2023).

Practical guidance follows for international construction contracts involving EAEU counterparties. First, regionally modelled Particular Conditions should be developed for the principal FIDIC books, embedding stabilisation mechanisms and sanctions clauses, harmonised notice windows and process maps for DAAB and arbitration, all aligned with the public-law imperatives of the participating states (FIDIC, 2024; Kondrashchenko & Kochesokova, 2023). Second, procurement frameworks should be standardised to a common “minimum sufficiency” in technical regulation and transparency so as to narrow variance and ensure comparability in cross-border projects (Treaty on the EAEU, 2014). Third, “soft supranationality” should be institutionalised through coordinated interpretive guidance by the EAEU Court on core FIDIC issues or via joint regulators’ guidance, thereby reducing regulatory arbitrage. Finally, sustained integration should target modular blocks of private law—tax, financial guarantees and export credit—that directly feed construction value chains (Vinnitsky & Kurochkin, 2018; Abdullin & Keshner, 2021).

Taken together, these measures can move Eurasian practice toward the EU’s level of predictability without upsetting the sovereignty–coordination equilibrium. For cross-border construction contracts the payoff will be lower transaction costs, faster clearances and fewer disputes, achieved by evenly embedding FIDIC standards within the regional legal forms of integration (Prikhodko, 2023; Yaryshev, 2021; Sokolova, 2017).

The contemporary international security system encompasses not only military dimensions but also economic and infrastructure ties that are directly linked to international construction projects. These projects have a significant impact on global stability and the peaceful coexistence of states, as they require comprehensive legal regulation in an increasingly complex international environment. Issues of collective security—including energy security and the legal standardization of infrastructure projects—play a crucial role in this context.

Major infrastructure projects such as the Nord Stream gas pipeline and subsea communication cables vividly illustrate the intertwining of security interests and legal regulation. Such projects invariably affect the interests of whole populations, and any damage to them impacts the lives of large numbers of people across different countries. A legal approach that considers the interrelation of societal interests and the interests of owners of global infrastructure projects is valuable for identifying the ultimate victims in damage-compensation cases concerning the disruption or harm of these major projects. As Yarkov and Dolganichev (2020) demonstrate, collective lawsuits can become an effective instrument for protecting the rights of participants in large infrastructure projects in cases of widespread violations caused by contractors’ misconduct or external threats (Yarkov and Dolganichev, 2020). These findings can be useful when addressing legal protection of infrastructure—particularly regarding the security of pipelines and submarine cables—since such lawsuits facilitate a more effective defense of all affected parties' interests in the event of disruptions arising from cyber-attacks or other forms of external interference.

In light of these new realities, international law requires constant review and adaptation to changing conditions to ensure the effectiveness of legal norms and the protection of states' interests. Effective observance of international security law can only be achieved through a coordinated approach. Such an approach must take into account both national interests and international obligations, requiring the integration of various levels of interaction—both universal and regional. It is important to note that security cannot be considered in isolation from global processes, since modern challenges such as terrorism, transnational crime, and ecological catastrophes demand joint efforts at all levels. A system must be created in which national and international aspects of security are interconnected and complementary; this is critically important for the effective implementation of international legal norms and standards (Kulagin, 2021).

In the context of a changing global order, as noted by Yakovenko (2019), modern international systems face challenges linked to growing regionalization and the weakening of traditional forms of cooperation. Yakovenko points to a trend of diminishing Anglo-Saxon dominance and the strengthening of developing countries’ positions, which requires more flexible security models and an enhanced role for regional structures (Yakovenko, 2019). These conclusions confirm the need to develop new legal mechanisms to protect infrastructure projects, especially in the face of cyberattacks and sabotage. Yakovenko also discusses a shift toward decentralized and flexible forms of interaction, where regional organizations can take a leading role in establishing robust legal frameworks. This approach would be an important step toward reforming collective security systems, which face growing challenges and need to adapt to changing international realities.

In the 21st century, energy resources play a key role in the stable functioning of society, forming the foundation not only of the economy but also of social processes and the realization of human rights and freedoms. Energy security is of particular importance amid increasing threats to national and international security, global economic crises, armed conflicts, and natural disasters (Kukeyev, 2024). It is under such conditions that the need to reform existing collective security systems—including their energy components—comes to the forefront. Current challenges in the energy sector require the development of new legal mechanisms aimed at protecting major international infrastructure projects. This chapter analyzes how the legal support of a comprehensive international security system is closely linked with international construction contract law (ICCL) and how existing legal mechanisms might be improved in light of current and future threats associated with international construction projects, especially in the energy sector.

One of the most significant challenges in the energy sector of the 21st century is the cyber threat, which has grown to alarming proportions in recent years. According to a study by the European Union Agency for Cybersecurity (ENISA), cyberattacks on energy infrastructure are becoming not only more complex but also more organized, posing a serious danger to national and international security. A prominent example of this phenomenon was the attack on the Colonial Pipeline in the United States in 2021. As a result of this attack, the perpetrators brought one of the largest fuel supply systems in the U.S. offline, causing significant supply disruptions on the East Coast and affecting many consumers and businesses. This incident was a landmark in the context of cyber threats, as it vividly demonstrated how vulnerable energy systems can be to modern cyberattacks and underscored the critical importance of legal mechanisms in ensuring the protection of such critically important facilities.

Effective legal regulation in the field of international security therefore requires a comprehensive approach addressing several key aspects. First, it is necessary to develop and implement new security standards that take into account modern challenges such as global threats related to terrorism, cybersecurity, and climate change. These standards must be flexible and adaptive to meet the dynamically changing conditions of international politics and economics.

Second, an essential component of successful legal regulation is active cooperation between states at the international level. This cooperation should include information sharing, joint exercises and drills, and the development of common strategies for preventing and responding to crisis situations. Sustainable international relations based on trust and mutual responsibility form the foundation for an effective security system. Moreover, integrating existing legal norms and mechanisms is an important step toward increasing legal resilience. This requires not only harmonizing national legislation with international standards but also creating new legal instruments capable of effectively responding to emerging threats. Implementing the comprehensive approach described above is critically important for successfully meeting future challenges in the field of international security (ENISA, 2021).

The present study is based on a detailed analysis of international legal norms, including treaties governing collective security and normative documents aimed at protecting international infrastructure projects. The work draws on the scholarship of leading researchers in the field, such as L. Klee (2018), who emphasizes the specifics of international construction contracts in her book International Construction Contract Law (Klee, 2018), and Martti Koskenniemi, whose work From Apology to Utopia: The Structure of International Legal Argument examines the structures of international legal argument and the fragmentation of international law (Koskenniemi, 2006). Special attention is given to concrete precedents such as the Nord Stream projects and the security of submarine cable lines, allowing the analysis of real examples of integrating legal security mechanisms with international construction contracts.

The issue of political instability in the energy sector also requires appropriate legal regulation. A striking example of the influence of political conflicts on energy security is the situation in the Middle East. Regional conflicts, such as the civil war in Syria, have had a significant impact on oil and gas transportation routes as well as on the stability of global energy markets (Ahmed, n.d.). In particular, the Syrian conflict has affected the political and economic stability of regional countries, highlighting the necessity of creating international legal mechanisms capable of minimizing the negative impact of political instability on energy supply.

Under international public law as defined by the UN Charter, the primary focus is on establishing states’ obligations to cooperate in order to ensure international peace and security. Infrastructure projects—among them transportation and energy pipelines as well as communication cable lines—are critical elements of the collective security system. These components are not only crucial for the global economy but also for ensuring security on the international stage. For example, the Nord Stream gas pipeline has become the subject of numerous international disputes and political sanctions, underscoring its strategic importance and the fragility of international relations in this area.

International security is multifaceted: while some countries prioritize energy security, for others international security is about the ability to protect primarily their spiritual and moral values. For Russia, issues of international security are directly linked to protecting national identity and sovereignty (Karpovich, 2024). Major powers have sought to enshrine issues of national security in legislation. Thus, Russia has enshrined the protection of morality and spiritual values as priorities, while the United States and Germany have mechanisms regulating issues related to energy resources and their exploitation. Such legislative regulation creates clear frameworks for state policy in these areas, which in turn helps minimize risks associated with external and internal threats.

Energy security is closely connected with environmental issues, making it necessary to integrate environmental norms into energy-related legislation. For example, ecological catastrophes such as the Fukushima Daiichi nuclear disaster in 2011 vividly demonstrated how dangerous energy facilities can be without proper protection and oversight. After this incident, the international community began actively reassessing its approach to nuclear safety, leading to the implementation of updated safety standards developed by the International Atomic Energy Agency (IAEA, 2015). This example emphasizes that protection of energy infrastructure must consider not only legal aspects but also environmental considerations, which in turn requires active international cooperation and coordination of measures at the global level.

Modern challenges such as acts of eco-terrorism and attempts to disrupt critical infrastructure operations have become key factors undermining the foundations of international law and threatening international security. These incidents not only endanger the safety of energy facilities but also create additional legal complexities that demand revision and adaptation of existing international norms and standards (Paramuzova, 2020). A particularly salient example of such incidents is the Zaporizhzhia Nuclear Power Plant, where attempts at diversion and sabotage have recently increased, causing serious concern at both national and international levels.

The application of security exceptions in international treaties, including WTO norms, also plays an important role in protecting international construction projects from external threats. Recent studies, such as the work of Boklan and Murashko (2023) (Boklan and Murashko, 2023), indicate that a broad interpretation of these exceptions can exacerbate international crises, as states may abuse these provisions to justify protectionist measures. For infrastructure projects such as submarine cables and pipelines, this creates a risk of legal uncertainty and necessitates the development of stricter international safety standards.

The importance of coordination among states in the realm of energy security is becoming increasingly evident, as confirmed by the experience of the European Union and the OECD. These organizations are developing legal and institutional mechanisms that facilitate more effective sharing of information, technology, and best practices among states. The European Union, in particular, has adopted an energy security directive that obliges member states to coordinate their actions during an energy crisis, thereby providing joint protection of their energy systems and reducing vulnerability to external threats (European Commission, 2019) (European Commission, 2019). This directive not only serves as a basis for legal regulation but also fosters cooperation among states, which in turn enhances the resilience of their energy systems.

Addressing emerging challenges in energy security requires comprehensive measures and active cooperation between states and international organizations. Oil and natural gas pipeline systems have traditionally been considered among the most reliable in the modern world. For post-Soviet states, these systems appeared indispensable. Built during the Soviet era, this pipeline network connected Russia to distant regions of the Soviet republics. Through these pipelines, Soviet oil and gas were delivered to Western Europe, and the reliability of these supplies was never in doubt. Even during the Cold War, despite heightened international tensions, pipeline-related issues were not viewed as energy security problems. After the dissolution of the Soviet Union, the main supply routes were supplemented with new pipelines, prompting Russia and newly independent states to construct additional gas and oil pipelines. These projects were intended to provide access to new markets or to expand access to existing ones. Local accidents or sabotage incidents, such as the 2009 demolition of the Davletabat–Dariali pipeline (part of the Central Asia–Center system), did not threaten the overall supply network and were usually resolved quickly (Deutsche Welle, 2009). However, the sabotage of the Nord Stream 1 and 2 pipelines on 26 September 2022 fundamentally altered the security and reliability of pipelines as energy carriers, creating new challenges for the international legal system and agreements.

The incidents involving the sabotage of Nord Stream 1 and 2 have further intensified concerns about the security of strategic infrastructure. In 2023, additional sabotage incidents were recorded, increasing pressure on the international community. At a UN Security Council meeting in October 2024, Russia presented updated proposals to strengthen legal mechanisms for protecting infrastructure, including the introduction of mandatory safety standards and the creation of an international monitoring body. As a result of these discussions, initial steps were taken toward developing new international agreements aimed at preventing similar incidents. Nonetheless, the process of implementing and harmonizing new legal norms remains protracted, underscoring the need for further efforts to respond swiftly to modern security threats.

The Nord Stream incident revealed significant shortcomings in the international legal mechanisms for protecting transboundary infrastructure projects. These projects, being vital to the energy security of states, are often exposed to risks arising both from political instability in transit regions and from acts of sabotage. This makes it necessary to implement more comprehensive and effective legal measures. L. Klee proposes using the universal principles of FIDIC contracts as mechanisms of universal norms that can guarantee the necessary legal transparency for participants in the construction and operation of large infrastructure projects (Klee, 2018). Overall, in the context of external political conflicts, there is a need to improve legal standards and mechanisms to ensure the security of such important infrastructure as gas pipelines, oil pipelines, and communication lines.

In addition to pipelines, submarine fiber-optic cable lines remain key elements of global infrastructure, providing communication between continents and the transmission of data. In 2024, new cases of cyberattacks and physical damage to these systems were recorded, highlighting the need to enhance protection. International legal norms were revised to account for new types of threats, and at a recent summit of international telecommunications organizations, updated security standards were adopted for submarine cable lines. These standards include mandatory cybersecurity and physical protection measures, as well as the establishment of specialized international agencies for incident monitoring and response. According to a United Nations report on submarine cable incidents (UNEP-WCMC, 2022) (UNEP-WCMC, 2022), such measures enhance infrastructure resilience to modern threats and require active international cooperation for their effective implementation.

A detailed analysis of legal regulation in the field of international construction contract law must pay attention to key actors on whose sovereign territory infrastructure energy facilities are operated and built. Pipeline systems, for example, play a vital role in supplying energy resources from exporting countries like Russia, Azerbaijan, Turkmenistan, Kazakhstan, and Uzbekistan to external markets beyond the former Soviet space. Russian international pipelines, in particular, link the country to the European Union and China. For example, through Ukraine run the “Urengoy–Pomary–Uzhhorod,” “Brotherhood,” and “Progress” pipelines, which for a long time provided the main supply of natural gas to Europe. Also significant is the Yamal–Europe pipeline, which traverses Belarus and provides reliable gas supplies westward (Gazprom Export, n.d.) (Gazprom Export, n.d.). Under current conditions, the Turkish export route for Russian natural gas is becoming increasingly important (Gazprom, n.d.).

As for oil transportation to Europe, about two-thirds of Russian oil exports to Europe go through Belarus (RIA Novosti, 2009). Also strategically important is the Caspian Pipeline Consortium (CPC) oil pipeline, over 1.5 thousand km long, which connects oil fields in western Kazakhstan with a maritime terminal near Novorossiysk on the Black Sea. This route, in addition to transporting small volumes of Russian oil, carries more than one-third of Kazakhstan’s oil exports, underscoring its importance for regional and wider energy stability (Caspian Pipeline Consortium, n.d.) (Caspian Pipeline Consortium, n.d.).

It has been established that the existing system of legal support for international security is not effectively integrated with ICCL norms. Analysis of cases such as the Nord Stream and Colonial Pipeline projects has revealed significant gaps in the international legal mechanisms, which are not capable of ensuring comprehensive legal certainty under modern threats. The identified shortcomings stem from the absence of international legal norms that take into account the rapid pace of technological change and the evolving nature of international conflicts. The current FIDIC standard contracts do not provide adequate measures for addressing new types of threats, creating legal uncertainty for participants in infrastructure projects and increasing risks to international security.

Based on the analysis, one can conclude that there is a need to develop and implement new legal norms and mechanisms that consider current economic, political, and environmental realities. This implies integrating environmental requirements into legislation governing energy projects, and creating legal instruments to protect infrastructure from cyber threats and acts of sabotage. It is recommended to strengthen coordination between states and international organizations to form more resilient and flexible legal frameworks. In particular, updating FIDIC standard contracts to account for modern threats would ensure a higher level of legal certainty and risk allocation. The creation of specialized international agencies responsible for monitoring and protecting infrastructure projects also appears advisable for rapid response to emerging risks.

Deeper integration of international security norms with international construction contract law will create a transparent legal system of responsibility allocation among all participants in the construction and operation of large infrastructure projects. This, in turn, will contribute to resilience and predictability in international investment and construction, reinforcing global stability and energy security.

International construction contract law has become a core strand of transnational commercial practice, structuring risk allocation, performance management, and dispute resolution across multi-jurisdictional projects. Against the backdrop of expanding cross-border infrastructure, peaceful means of dispute settlement—most prominently arbitration and mediation—serve as essential tools to reduce time, cost, and relational breakdowns between employers and contractors. Current trends also include the growing institutional autonomy of international courts and tribunals, whose operations increasingly shape national legal fields and regulatory approaches to construction disputes (Lall, 2017). In this setting, harmonized procedures (arbitration, mediation) and institutionalized guidance (e.g., FIDIC) gain salience for predictability and enforceability in international projects.

A multipolar order and the rise of large cross-border construction contracts intensify both the need for and the reliance on peaceful settlement mechanisms. Institutions’ financial models and partnerships with non-state actors reinforce adjudicatory independence and functional effectiveness. This “autonomization” fuels a feedback loop: the more independent international judicial bodies become, the more their standards and practices influence domestic frameworks governing construction disputes (United Nations Security Council, 1991). At the same time, literature highlights the necessity of standardized arbitral procedures and the progressive unification of legal norms to stabilize expectations among parties and to lower coordination costs in multi-state projects (Boguslavskiy, 2007).

In conceptual terms, punishment and reconciliation remain intertwined. As noted by H. Arendt in 1958, “People cannot forgive what they cannot punish, and they cannot punish what they find unforgivable” (Arendt, 1998). The tension reflected in this dictum surfaces acutely in international construction disputes: parties’ choice between arbitration and consensual processes (e.g., mediation) often turns on whether sanctioning non-performance is viewed as necessary—or whether preserving a critical long-term relationship takes priority (Arendt, 1998).

Arbitration remains the principal forum in international construction practice because it combines neutrality, expertise, and global enforceability. The Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958) obliges Contracting States to recognize and enforce foreign awards, subject only to limited, exhaustively enumerated defenses (United Nations, 1958). The UNCITRAL Model Law contributes complementary procedural uniformity, supporting party autonomy and procedural due process in international cases (Boguslavskiy, 2007). Together, these instruments anchor the default pathway for resolving complex, high-value construction disputes.

Common-Law Doctrinal Inflection:

Common-law enforcement contexts (e.g., under the supervision of the Supreme Court/Historic House of Lords, Privy Council, and senior appellate courts) place particular emphasis on: (i) conditions precedent to claims; (ii) time-bar architecture; (iii) notice obligations (often a 28-day window under standard forms), and (iv) reasonableness/proportionality as lenses for construing both contractual machinery and party conduct. While the New York Convention (United Nations, 1958) narrows refusal grounds, domestic courts still scrutinize whether parties complied with pre-arbitral prerequisites (e.g., DAAB steps), whether the notice regime was met, and whether enforcement would offend fundamental procedural fairness.

Across jurisdictions, FIDIC standard forms provide a coherent, exportable matrix for risk distribution and dispute processing in construction projects. The contracts’ dispute architecture requires timely notice (often within 28 days), establishes claim substantiation, and channels disagreements to a Dispute Avoidance/Adjudication Board (DAAB) before arbitration. This layered design reduces surprise, aggregates contemporaneous evidence, and preserves project momentum. For cross-border projects, contractors and employers frequently adopt FIDIC precisely because its adjudication and arbitration provisions dovetail with the New York Convention’s enforceability logic (Moore, 2014), (Boguslavskiy, 2007).

Common-Law Operational Points:

• Conditions precedent: Courts in common-law systems typically treat DAAB referral and notice clauses as enforceable pre-arbitral gatekeepers; non-compliance may defer or bar a claim until the condition is satisfied—unless excused on accepted grounds (e.g., futility where narrowly recognized).

• Time-bar (limitation/forfeiture): Strict time-bar clauses are construed according to their text and commercial purpose. Relief from forfeiture is exceptional; parties must show scrupulous compliance.

• Notice within 28 days: The 28-day notice mechanism promotes contemporaneity and mitigates prejudice. Disputes often turn on whether the “knowledge trigger” was activated and whether the notice content met the contract’s specificity requirements.

• Reasonableness / proportionality: While freedom of contract prevails, courts test enforcement impacts through doctrines of reasonableness and proportionality in context (e.g., whether procedural default generates disproportionate forfeiture relative to the breach).

Mediation gains traction globally as an agile, confidential, relationship-preserving method that can either pre-empt arbitration or run in parallel with adjudication under FIDIC. Case experience shows that well-structured mediation shortens timelines and reduces costs without sacrificing outcome durability. Yet diffusion across legal families remains uneven; cultural and institutional barriers continue to limit uniform uptake. In international construction, mediation is most effective when embedded contractually (clear triggers, timetables, and mediator appointment mechanisms) and when coordinated with DAAB/arbitration steps to avoid jurisdictional dead-ends. (Erpyleva, 2015)

International adjudicatory bodies have broadened their docket, and their jurisprudence radiates into domestic normative orders that condition construction activity (e.g., public-law constraints, human-rights proportionality review). The European Court of Human Rights’ expanding output illustrates how supranational case-law elevates procedural standards affecting economic relations (Erpyleva, 2015), and Protocol No. 9 opened direct access for private actors, strengthening judicial oversight across sectors (Council of Europe, 1990). These developments can recalibrate national balances between public interests and private contractual autonomy in construction markets.

In offshore construction and resource schemes, disputes intersect with the United Nations Convention on the Law of the Sea (UNCLOS), including issues tied to exclusive economic zones. Awards and judgments in this space may have immediate operational consequences for project siting, access rights, and state-contractor relations (United Nations, 1982). For common-law practitioners, this interface underscores the need to integrate public-international-law risk into contract drafting (e.g., stabilization language, force-majeure allocation keyed to maritime entitlement disputes).

(1) Arbitration primacy under the New York Convention (United Nations, 1958) remains intact, but outcomes hinge on rigorous compliance with conditions precedent, time-bars, and notice protocols planted in FIDIC.

(2) DAAB processes are not mere preliminaries; they structure the evidentiary record and often predetermine the posture of subsequent arbitral proceedings, with enforcement leverage drawn from the Convention regime (Moore, 2014), (Boguslavskiy, 2007).

(3) Mediation is most valuable when knitted into the contractual timeline and aligned with arbitral architecture; it should be drafted with explicit triggers, stay provisions, and confidentiality carve-outs so that parties can pivot without waiving rights.

(4) Supranational case-law and institutional autonomy (Lall, 2017), (Erpyleva, 2015), (Council of Europe, 1990) continue to imprint domestic standards (reasonableness/proportionality), influencing how courts police the enforcement of dispute-resolution machinery in construction contracts.

Peaceful means of dispute settlement in international construction hinge on a triangle: FIDIC-based contractual governance, arbitration enforceability under the New York Convention (United Nations, 1958) and UNCITRAL Model Law (Boguslavskiy, 2007), and a judicial environment increasingly shaped by autonomous international courts (Lall, 2017), (Erpyleva, 2015), (Council of Europe, 1990). For common-law audiences, the operative lesson is discipline: draft with precision; administer claims to the exact letter (notice within 28 days, time-bars, DAAB sequencing); and anticipate the radiating effect of supranational norms on domestic enforcement. This is not an incremental compliance exercise but the decisive terrain on which cross-border project outcomes are won or lost.

Digitalisation fundamentally transforms the international regulation of construction projects, altering traditional approaches to implementation. Modern information and digital technologies – such as Building Information Modelling (BIM), 3D terrain modelling and digital twins – not only optimize construction processes but also give rise to new legal challenges concerning intellectual property (e.g. rights to digital models and the algorithms governing them) and the data generated by these models. These developments call for a rethinking of international construction contract law (ICCL) in light of differences between national legal regimes and global standards. In particular, cross-border data exchange, protection of confidential information, and legal control over information flows related to project operations must be addressed. These processes should comply with information law norms, including data protection, the legal framework for electronic transactions, cybersecurity, and the harmonization of national information standards.

As A. A. Danelyan observes, the absence of a unified approach to cyberspace and digital technologies hinders the creation of effective international mechanisms needed to harmonize legal regimes and ensure legal predictability. These issues are especially pressing given the growing importance of the digital economy, in which data becomes a key resource for the construction industry and international cooperation. This creates a requirement for national legal systems not only to improve existing legislation but also to adapt it to new realities (Gulemin, 2023). Harmonizing national regulations with international standards is crucial to creating a single legal environment in which participants can confidently interact using modern digital tools in international construction contracts.

Information-related aspects of construction go beyond intellectual property issues and include regulation of electronic document management, participant authentication, electronic data exchange, and the use of cryptographic protection as provided by international agreements. There is a need to synchronize rules governing electronic document flow to give legal force to electronic transactions and minimize the risks of data forgery. In the context of digital twins and extensive data collection for construction sites, it is crucial to distinguish which categories of data should be public and which should be treated as personal data. Given the increasing role of data analytics, common regulations for data processing and storage – such as the EU’s General Data Protection Regulation (GDPR) and Russia’s Federal Law on Personal Data (152-FZ) – should apply. Such regulatory alignment removes additional barriers and risks in international projects, ensuring legal security and protection of private interests.

Notably, domestic developments in information technology highlight the need for a robust legal framework. According to M. A. Malinovsky and I. E. Alenin (2022), Russian software for information modelling (e.g. Renga, Pilot-BIM) shows progress but still lags behind foreign counterparts in functionality and compliance with international standards. The advancement of ICT and policies of import substitution and competitiveness of domestic software point to the necessity of creating an effective legal basis for ICT use in construction. Thus, reliable legal mechanisms ensuring intellectual property protection, standardization and legal certainty, while recognizing cross-border data exchange and integration of Russian solutions into the international regulatory system, are decisive factors in the digitisation of the construction sector.

The introduction of digital twins (Construction 4.0) combined with deep learning (DL) technologies is an important direction in digital transformation. Research by Kor, Yitmen, and Alizadehsalehi (2023) confirms that integrating digital twins and deep learning contributes to optimizing design and construction processes by enabling autonomous modelling, risk prediction and decision support via cognitive data analysis. The creation of digital twins enables interconnected, adaptive digital ecosystems incorporating big data analytics, automated asset management and resource optimisation. This integration becomes an integral element of international construction contracts, requiring legal regulation of intellectual property, data processing and cross-border information exchange. It underlines the need to develop unified international legal mechanisms that ensure the predictability of the digital environment in construction.

In the context of digital twins and large datasets from construction sites, distinguishing between public and personal data categories is critical. Given the heightened role of analytics, adherence to common data processing and storage regulations – such as the EU’s GDPR and Russia’s 152-FZ – becomes necessary when European market participants are involved. Such regulatory consistency alleviates additional barriers and risks in international projects, ensuring legal safety and protection of private interests.

In this regard, a noteworthy development is the Moscow Government Decree of 29 December 2022 No. 3048-PP on the “AIS ‘Digital Twin’.” This regulation establishes the authority of the operator and sets rules for collecting, processing and exchanging spatial data, effectively creating legal frameworks for implementing digital twins in urban planning processes. This approach aligns with trends in import substitution and digital transformation, allowing legal regulation to adapt to rapidly evolving technological conditions. The legal integration of the “Digital Twin” into urban management systems underscores the prospect of further cross-cutting digital technologies and the need for unified international legal principles (including protection and use of intellectual property and cross-border data exchange) to enhance the competitiveness of the Russian construction industry and ensure transparency in major infrastructure projects.

Strategic documents such as Russia’s Information Society Development Strategy for 2017–2030 define key directions for regulating information technologies, including their application in construction. They enshrine the necessity of creating international legal mechanisms to ensure that innovative solutions comply with current standards. Harmonisation of national legislation with international norms helps to form a unified legal environment, improve the competitiveness of domestic companies and advance international cooperation. The Strategy emphasizes protecting national interests, reducing legal risks, and regulating rights to intellectual property, security and quality of digital technologies. Forming an effective legal environment is a necessary condition for integrating digital solutions into international construction contract law.

The digital economy envisions widespread use of information modelling and automated project management technologies, which contribute to more effective interaction among participants in international construction projects, streamline contract negotiation and ensure transparency at all stages. However, without adequate legal mechanisms, these opportunities can be accompanied by significant legal risks, especially in a cross-border context. Therefore, ICCL and related areas must harmonize existing legal norms and terminology. As T. N. Savina (2018) notes, the digital economy creates new prospects and legal challenges, requiring legal systems to be flexible and respond quickly to technological changes.

The study leads to the following conclusions: Digitalisation of international construction contracts necessitates revising existing legal norms, especially regarding protection and use of intellectual property and data. The implementation of BIM and other digital technologies introduces new legal challenges, such as ownership and management of rights to digital models, which can cause disputes and complications in cross-border projects in the absence of clear international rules. The proliferation of global ecosystems (e.g. smart home/office infrastructures) calls for legislation covering all aspects of user-provider interactions. Cross-border use of global terrain modelling systems requires alignment of different legal regimes to resolve IP and data exchange issues.

In construction, standard forms developed by the International Federation of Consulting Engineers (FIDIC) are key tools for harmonizing contractual obligations internationally. These forms provide a uniform legal mechanism regulating client–contractor–consultant relations and reduce legal risks in implementing cross-border contracts. As L. Klee (2018) notes, using FIDIC standards ensures contract predictability, minimizes disputes and creates legal frameworks for managing digital models. However, despite the broad applicability of FIDIC forms, they currently lack specific provisions on digital technologies and BIM, necessitating their adaptation to modern realities.

Based on these conclusions, several recommendations follow. It is important to develop international legal norms that unify approaches to the use of digital technologies in construction projects. This includes a clearer definition of rights for using digital models, harmonization and proper interpretation of terminology in BIM, and the development of international standards for managing cross-border data flows and intellectual property. Personal data collected by information systems should be categorized and structured in contracts, and license agreements must address not only the use of digital models but also the management of large volumes of data generated during asset operation.

Expanding the scope of ICCL through information and communication technologies implies including contract clauses on dispute resolution that address conflicts of law and information law principles. The organization of cross-border interaction (for example, determining the level of trust in smart contracts or blockchain protocols) could be regulated by specific legal instruments such as the UNCITRAL Model Law on Electronic Commerce (1996) and the Model Law on Electronic Signatures (2001). Arbitration rules like those of UNCITRAL (1976, amended) and the ICC Arbitration Rules (2021 edition) explicitly allow electronic interaction of the parties. Construction contracts should also enshrine rules for electronic evidence, including criteria for trusting executive and primary accounting documents in digital form. When using FIDIC standard forms, it is advisable to supplement them with clauses on digital quality control, performance monitoring, and data protection, aligning these provisions with the requirements of international information law. Such a comprehensive regulatory framework would ensure a more reliable and transparent legal environment for introducing digital solutions and foster innovative mechanisms in the construction industry.

International construction contract law (ICCL) constitutes an important part of international private law, governing cross-border construction projects. The development of this field has been largely driven by the activities of the International Federation of Consulting Engineers (FIDIC), which since its founding in 1913 has made a significant contribution to the harmonization of legal norms and project management procedures. FIDIC contracts provide legal certainty by offering efficient tools for project governance, protection of the parties’ rights, and dispute resolution arising in the execution of major international projects. These standards have contributed not only to the development of international construction law as an independent discipline but also to strengthening international legal cooperation in the construction sector. The present study draws on academic publications, international agreements, and arbitration cases relating to the application of FIDIC standards in the international construction industry. Special attention was paid to key FIDIC contract forms—namely the “Red Book,” “Yellow Book,” and “Silver (formerly Gold) Book”—used in projects of varying scale and complexity. These contracts form the legal foundation for regulating construction projects, thereby contributing to the unification of legal norms in international construction relations. The influence of FIDIC on the evolution of international construction law has been analyzed, allowing a deeper understanding of FIDIC’s role in standardizing and harmonizing construction contracts.

The international legal aspects of educational integration in the Eurasian space represent a key facet of international legal cooperation within the framework of the Eurasian Economic Union (EAEU). This process creates legal mechanisms that facilitate effective interaction among member states, thereby supporting the development of a unified educational environment and promoting integration processes. The importance of this initiative lies in establishing a single legal basis that ensures the harmonization of educational standards and programs, as well as easing the exchange of knowledge and experience among the region’s countries. It is aimed at achieving the goals set out in the EAEU Treaty, including the creation of a common economic space, strengthening the exchange of skilled professionals, and integrating member states’ resources. As Deputy Chairman of the Federation Council Konstantin Kosachev noted during a roundtable on Russia’s chairmanship in EAEU bodies, the Eurasian Economic Union is a self-sufficient structure capable of becoming one of the poles of a multipolar world and playing a key role in forming the Greater Eurasian Partnership. Strengthening international educational ties is essential to achieving these goals, as it enables the training of qualified personnel to advance integrative collaboration under the Strategic Directions of Development up to 2025 and future plans through 2030 and 2045.

Scientific, technological, and industrial integration processes within the EAEU play a vital role in international cooperation amid the challenges of the Fourth Industrial Revolution. These processes shape the contours of the Union’s interaction with external partners, further enhancing cooperation. A prominent international entity that offers broad prospects for the Eurasian Union’s scientific and technological development is the United Nations Conference on Trade and Development (UNCTAD). The EAEU states participate in UNCTAD through a dual format: via the Eurasian Economic Commission (EEC) and independently through each member state. The organizational framework for this cooperation is laid out in the Memorandum of Cooperation between the EEC and UNCTAD, which defines the main directions of joint work in key areas, including scientific and technological cooperation. One priority objective is to identify possible directions for cooperation in the science and technology sphere, which could contribute to modernizing the technological base of the EAEU member states and developing their construction infrastructure by introducing new technologies. It is important to note that international scientific and technical cooperation is central to efforts to develop the legal framework for international construction contracts. At the same time, scientific-technical cooperation plays a crucial role in technology transfer to the construction industry, which can significantly enhance the competitive positions of EAEU countries on the world stage. One of UNCTAD’s activities is facilitating technology transfer at national and international levels, which is especially relevant for EAEU member states involved in international construction projects. In this context, UNCTAD’s recommendations and technical assistance can make a substantial contribution to improving the Union’s global competitiveness and advancing international legal standards in construction. Through its cooperation with the Eurasian Economic Commission, UNCTAD promotes the development of sustainable economic and infrastructure links, creating conditions for implementing long-term construction projects in line with current legal norms and standards.

In the EAEU integration process, particularly in education, a legal foundation is needed to consolidate the achieved level of cooperation. Although the EAEU Treaty does not explicitly provide for educational integration, the strengthening of educational ties among member states continues actively. This is especially important for preparing the workforce needed to support legal integration and the execution of international construction projects within the EAEU. Issues of mutual recognition of educational credentials and regulation of training specialists for the Eurasian legal space are becoming acute in the context of technological modernization and the legal support of international construction contracts. From a legal standpoint, cooperation between the EAEU and UNCTAD illustrates the interaction of two differently constituted entities: the EAEU as a regional economic integration organization, and UNCTAD as an auxiliary organ of the UN General Assembly. Despite these differences, the participation of the Eurasian Economic Commission as the Union’s representative opens up additional opportunities for EAEU countries to engage in global scientific, technological, and construction projects, thereby strengthening international legal cooperation in the construction field.

Since 2014, the world has faced changes that reinforce multipolarity and give rise to new non-Western “centers of power.” Alongside the EAEU, the significance of international organizations such as the Shanghai Cooperation Organization (SCO) has grown. The SCO is founded on principles of equality and respect for the cultural and legal diversity of its participants. These principles help strengthen international cooperation in the science and technology sphere and underlie multilateral projects aimed at sustainable development of SCO member countries. Such developments create conditions for a review and further expansion of the legal bases of interaction within similar organizations, underscoring the importance of intensifying their activities under current global conditions.

The existing governance structure of the SCO contributes to strengthening international relations, including cooperation in key areas such as construction and scientific-technical exchange. One important direction in construction cooperation is the development and implementation of international standards, such as the FIDIC model contracts, which serve as the foundation for regulating construction projects at the global level. On the other hand, some researchers argue that many international relations problems stem from internal constitutional and social issues within states. These issues hinder full interaction on the international stage and call for the development of more flexible and effective mechanisms to ensure stable cooperation.

The need to develop flexible legal mechanisms for effective cooperation in the face of global challenges is growing. In the construction sector, such interaction is particularly important for exchanging advanced technologies, managing large infrastructure projects, and standardizing legal norms for cross-border construction contracts. However, destructive factors—such as the primacy of political interests over scientific ones—continue to negatively impact international projects, including those in construction. This requires increased attention to safeguarding national interests within scientific-technical cooperation, particularly within organizations like the SCO. The importance of reinforcing legal mechanisms to maintain stable partnerships and create favorable conditions for scientific-technical and construction cooperation is confirmed by Vasilenko V. I.’s study, which examines the role of the SCO in ensuring regional security and stability.

In a rapidly changing world order, the threats of transnational terrorism, separatism, and extremism have become especially acute, requiring a comprehensive approach to security. These threats have become key factors influencing Russia’s strategy of engagement with other states in the international legal arena. The SCO’s adopted “Three Evils” doctrine—combating terrorism, separatism, and extremism—serves as an important tool to counter these transnational threats. This document emphasizes the necessity of joint efforts by member countries in fighting terrorism, separatism, and extremism, thereby strengthening the legal foundations for cooperation in the field of security. An important aspect of this doctrine is its focus on multilateral approaches to conflict resolution and regional stability, which is essential for creating favorable conditions for the development of international law. Against this backdrop, Russia continues to actively advance international legal cooperation, placing special emphasis on collaboration in the construction and scientific spheres and on the security of major infrastructure facilities such as pipelines and communication networks. Security issues thus become key tasks in the context of executing cross-border projects that not only drive economic development but also reinforce the legal mechanisms that protect the interests of all participants. A focus on international cooperation in construction and science enables Russia not only to safeguard its interests but also to strengthen its position on the world stage.

The importance of a cross-sectoral approach to regulating international cooperation is emphasized in the research of N. E. Tyurina. The author notes that international integration and the development of new forms of interaction between universities and research organizations require a significant breakthrough in the legal regulation of international scientific cooperation. Harmonization of educational and scientific spaces, ensured by international agreements, fosters effective interaction among states, which is pertinent to the construction industry as well. Tyurina and co-authors also draw attention to the role of regional organizations—such as the SCO and the Association of Southeast Asian Nations (ASEAN)—in forming a unified scientific and technological environment. The creation of special coordinating bodies and the conclusion of international agreements allow for the unification of legal norms and facilitate interaction between countries. This experience can be applied to the development of international construction contract law, particularly regarding the adaptation of FIDIC standards to national legal systems. Furthermore, Tyurina’s study highlights the relevance of intellectual property protection and digitalization issues in international cooperation, and the need to develop new regulatory provisions and adapt existing norms to new forms of relations arising from technological progress. These considerations are especially significant for the construction sector, where the introduction of innovations and new technologies demands modern legal support.

Scientific-technical cooperation is one of the main aspects of international legal cooperation, and its importance significantly increases with the widespread adoption of robotics and artificial intelligence. Considering the challenges encountered during the COVID-19 pandemic, the need for integrated efforts and knowledge exchange in healthcare became evident. However, even in this globally important sphere, destructive factors emerge when political and short-term gains begin to prevail over long-term scientific projects. In such circumstances, Russia’s protection of its national interests in scientific-technical partnerships, including cooperation within the SCO framework, becomes one of the leading directions of international legal interaction in the coming years.

A key element of international legal cooperation in construction is the resolution of disputes arising during the execution of major projects. FIDIC contracts include effective conflict-resolution mechanisms, such as Dispute Adjudication Boards (DABs) and international arbitration, to settle disputes during construction. The use of FIDIC-based arbitration practices in various jurisdictions contributes to the harmonization of legal norms and the strengthening of international cooperation, making these contracts one of the key instruments in regulating transnational construction projects. These mechanisms allow the parties to avoid lengthy court proceedings, which is particularly important in international projects involving multiple jurisdictions. The application of FIDIC-based arbitration procedures facilitates efficient project management and swifter dispute resolution, thereby bolstering international cooperation and the harmonization of construction law. A crucial role in this process is played by international arbitration practice, which is recognized and used in global construction disputes, furthering the development of legal standards within international construction contract law.

The regulatory and organizational potential of the SCO is considered quite high, as evidenced by the implementation of the 2025 SCO Development Strategy adopted at the 2015 Summit. The strategy’s main goal was to take cooperation among member states to a new level, with a special focus on ensuring regional security, which has been achieved in recent years. However, important directions remain the fight against terrorism, separatism, and extremism, as well as combating illegal migration and trafficking in narcotics and arms. Special attention is given to protecting the information space and improving mechanisms for promptly responding to security challenges in the region. In the economic sphere, the key areas of development include transport, energy, finance, communications, education, innovation, science, and technology. Plans include establishing a network of industrial clusters along transport corridors to stimulate economic growth, and in agriculture, prioritizing joint high-tech production and processing projects to boost food security. Humanitarian cooperation involves creating a unified educational space—such as the SCO Network University project—and developing youth cooperation through the SCO Youth Council to promote student exchange and raise education levels. Establishing a unified information space is also envisaged to enable rapid responses to media challenges and to protect member states’ interests in the information domain. Creating a unified educational space within the EAEU based on agreed legal and professional standards will be an important step in training highly qualified personnel. Cross-training programs developed through joint educational curricula will give EAEU countries competitive advantages in technology and innovation, directly affecting their ability to participate in cross-border construction projects—especially given global trends in digitalization and infrastructure modernization.

Standardization simplifies interaction among countries’ legal systems, and the model contracts and instruments developed by FIDIC play a key role in standardizing the construction sector. This is especially relevant for the BRICS countries, regarded as a driving force of global development with numerous large-scale international infrastructure projects. Model contracts provide the legal basis for effective project management, particularly for projects financed by international financial institutions like the New Development Bank (NDB). Unified standards help build trust between parties and offer more transparent legal frameworks for executing major infrastructure projects. Since its establishment in 2015, the NDB has actively utilized FIDIC standards to provide a legal basis for the infrastructure projects it finances. This approach allows for the unification of legal norms and reduction of risks in cross-border project execution while strengthening trust between parties. As noted in the NDB’s 2023 assessment of India’s public procurement system, the bank developed programs such as SUNP (Streamline and Simplify the Use of Country Procurement Systems for NDB Portfolio) aimed at improving and standardizing procurement systems for projects implemented in BRICS countries, including India. These initiatives enable the use of national procurement systems while maintaining high international practice standards—particularly FIDIC standards—substantially improving the management of large-scale projects.

International construction contract law provides universal instruments for project management and dispute resolution. FIDIC standards simplify the contracting process, making contracts more predictable and legally secure for all parties. However, a key challenge remains the adaptation of these standards to local legal systems, necessitating the development of flexible mechanisms for interaction between international and national law, as well as the implementation of unified standards within the EAEU and the United Nations. M. V. Shugurov emphasizes the importance of scientific and technical cooperation between the EAEU and UNCTAD, which is becoming increasingly relevant in the context of the Fourth Industrial Revolution. He concludes that this cooperation is currently latent and needs to be activated to modernize the EAEU member states’ technological base.

However, an essential balance must be maintained between universal FIDIC standards—which facilitate the execution of complex infrastructure projects under BRICS and NDB frameworks—and respecting national interests, including preserving Russia’s existing theoretical and regulatory basis of construction rules and state standards. E. S. Anichkin and E. A. Kulikov note the growing need to prioritize Russia’s national interests in the scientific realm amid changing international relations. The scholars stress that addressing these issues is at an embryonic stage and requires refinement, possibly drawing on the experience of the CIS, where agreements on scientific cooperation are already in place.

This study indicates that international legal cooperation under FIDIC continues to play an important role in the development of international construction contract law. The standardized contract forms and regulations developed by FIDIC help harmonize standards and protect the rights of participants in international construction projects. Within regional unions such as the EAEU, SCO, and BRICS, universal standards enable financial institutions like the NDB to more effectively oversee the implementation of major infrastructure projects. Unification of legal norms and enhanced protection of the parties’ interests contribute to the harmonization of legal regulation across different countries, allowing for efficient management of large international projects and reducing the risks of legal uncertainty. Nonetheless, adapting these standards to national legal systems remains a complex task that requires deeper legal elaboration and close cooperation among states and international organizations.

To ensure the continued development of international construction contract law, it is necessary to adopt more flexible approaches to adapting universal standards, taking into account national legal particularities. This involves not only harmonizing legal norms but also training professionals under integrated educational programs, which will strengthen inter-state cooperation and increase the legal predictability of international projects. Educational initiatives within the EAEU, SCO, and BRICS play a pivotal role in preparing specialists who will shape these universal standards.

The future evolution of international construction contract law should aim to balance the interests of all parties and establish fairer conditions for implementing major projects. Such an approach will reinforce international cooperation and contribute to achieving sustainable development.